Stable income and good credit history are not a guarantee that the savings Bank will not refuse to grant a mortgage. The main causes of failure can be divided into five groups.
Borrowers are presented the following range of requirements:
- age from 21 years;
- age at the time of loan repayment up to 75 years;
- work experience - at least 6 months at current place of work and at least 1 year experience in the last 5 years; if a borrower changes jobs frequently or has gaps in employment history, it also negatively affects the probability of loan approval;
provides full spectrum of documents. Inaccuracies in the application for credit or the provision of incomplete list is one of the reasons for the refusal. It is worth considering that providing false certificates of income threatens not only the denial of the mortgage, but the inclusion in the black list. In this case, the loan the borrower fails to provide, not only in the savings Bank, but also in all other banks.
The most likely reason for rejection is a bad credit history of the borrower contained in the credit Bureau. It can be corrupted in case of untimely payment of the credit obligations by the borrower or with unpaid credit, where he acted as the guarantor.
The cause of failure can also be the fact that the borrower has in the recent past took credit for the budget thing, for example, a mobile phone. It forces the Bank to question its solvency.
The decision of the Bank is affected by the requested amount and level of debt. So, a positive factor is the availability of down payment and income level of the borrower, as well as their stability. Taken into account by the Bank and the number of dependents in the custody of the borrower.
In some cases, the Bank may recommend to make a higher initial payment or increase the term loan to reduce the monthly payment.
Acquired mortgage property (or that which is the object of a pledge) must be liquid, and documents of property rights must be executed by all the rules. The reason for failure may be the negative reputation of the sellers of real estate.
Typically, the Bank encourages the borrowers to find another object.
There are a number of other reasons, they usually are not the main causes of failure, and are considered complex. Among them:
- level of education (priority is given to borrowers with higher education);
- criminal history, the availability of offences (criminal record);
- availability of loans from other banks;
parallel to applying for a mortgage to other banks;
- getting denied from other banks;
- salary that does not correspond to the average value;
- frequent change of job or suspiciously rapid career advancement.
1. Mismatch standard requirements
Borrowers are presented the following range of requirements:
- age from 21 years;
- age at the time of loan repayment up to 75 years;
The Bank estimates only 7 out of 10 borrowers get a positive response on the loan.
- work experience - at least 6 months at current place of work and at least 1 year experience in the last 5 years; if a borrower changes jobs frequently or has gaps in employment history, it also negatively affects the probability of loan approval;
provides full spectrum of documents. Inaccuracies in the application for credit or the provision of incomplete list is one of the reasons for the refusal. It is worth considering that providing false certificates of income threatens not only the denial of the mortgage, but the inclusion in the black list. In this case, the loan the borrower fails to provide, not only in the savings Bank, but also in all other banks.
2. Bad credit history
The most likely reason for rejection is a bad credit history of the borrower contained in the credit Bureau. It can be corrupted in case of untimely payment of the credit obligations by the borrower or with unpaid credit, where he acted as the guarantor.
A list of the requested Bank documents for the loan varies depending on the mortgage program. In most cases, it is the identity documents and proof of income.
The cause of failure can also be the fact that the borrower has in the recent past took credit for the budget thing, for example, a mobile phone. It forces the Bank to question its solvency.
3. Low solvency of the borrower
The decision of the Bank is affected by the requested amount and level of debt. So, a positive factor is the availability of down payment and income level of the borrower, as well as their stability. Taken into account by the Bank and the number of dependents in the custody of the borrower.
In some cases, the Bank may recommend to make a higher initial payment or increase the term loan to reduce the monthly payment.
4. An unsatisfactory evaluation of the selected property
Acquired mortgage property (or that which is the object of a pledge) must be liquid, and documents of property rights must be executed by all the rules. The reason for failure may be the negative reputation of the sellers of real estate.
Typically, the Bank encourages the borrowers to find another object.
5. Other reasons
There are a number of other reasons, they usually are not the main causes of failure, and are considered complex. Among them:
- level of education (priority is given to borrowers with higher education);
- criminal history, the availability of offences (criminal record);
- availability of loans from other banks;
parallel to applying for a mortgage to other banks;
- getting denied from other banks;
- salary that does not correspond to the average value;
- frequent change of job or suspiciously rapid career advancement.
