Submitting a home loan application can be a bit of a nerve wracking process, particularly if you are looking to put a deposit on your very first home. Some people find themselves continually facing refusals, and this just makes the process feel even more challenging. Being well prepared is a key factor in having a successful home loan application, so there are a few things you should be aware of before you get started. Here are 4 things that can affect your chances of having your home loan approved.

Income and Job Type

Unfortunately not all jobs are considered equally when it comes to getting a home loan. If you work on a contract basis, have your own business or are self-employed, you may be experiencing difficulty getting the fair treatment that you deserve. You can counteract the bias that many lenders may have against your employment type by have over 20% saved as a deposit. The higher your deposit, the less likely your lender will reject your application simply based on your income and type of job.

Credit Rating

Your credit history is one of the first things that a lender will check when considering your application.  To improve your chance of success, it’s important to make sure that your credit rating is in the best shape possible. You can achieve this by having a proven record of prompt repayments on loans and credit cards, and by ensuring that all of your bills are paid on time. If you are experiencing difficulty at any time, contact your service provider or lender immediately to work out an alternative arrangement that won’t adversely affect your credit rating.
4 Things That Can Affect Your Chances of Having Your Home Loan Approved

Inadequate Preparation

Being adequately prepared is the key to a successful application. Sometimes this can take months, if not years to truly achieve, so it’s important to get started right away. Your priorities should be to save a significant deposit, consolidate your financial situation and preserve your credit rating. With all of this taken care of, you can be confident that your home loan application has every chance of being approved.

Finding the Right Lender

When embarking on the journey of securing a home loan, finding the right lender is paramount. It’s not merely about interest rates and terms but also about compatibility and trustworthiness. Conducting thorough research, comparing offers, and seeking recommendations can be pivotal in this process. A reputable lender will prioritize transparency, providing clear information on rates, fees, and any potential pitfalls. Beyond financial aspects, assessing customer service quality and responsiveness is essential for a smooth borrowing experience. Ultimately, the ideal lender aligns not only with financial needs but also with the borrower’s values and preferences, fostering a relationship built on mutual understanding and support throughout the homeownership journey.

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