February 22nd, 2018 9:04 AM by Jackie A. Graves, President
mortgage application was denied. These words sound harsh, but they don’t always
mean you can’t get a mortgage.
your loan application gets rejected, “It shouldn’t be a surprise,” says Brian
Koss, executive vice president at the Mortgage Network Inc. “Your loan officer
should have given you a good assessment.”
application process is fairly rigorous, no matter who you’re
applying with. At some point in the process, if you have one or several strikes
against you, the loan officer should give you some indication that you may not
lender is supposed to provide you with the reasons you were denied so you can
take that info to heart and use it to identify a way to resolve things, so you
can get on a better financial footing and you can re-qualify later,” says Bruce
McClary, vice president of public relations and external affairs for the
?nonprofit National Foundation for Credit Counseling.
credit score plays a big role in determining what types of loans and rates
you’re eligible for. Be sure to examine your
credit report closely and make sure there aren’t any errors on
it that might be dragging down your rating.
to know your credit score and take action to endure your credit score is
strong,” says Dave Mele, president of Homes.com.
your credit score isn’t great and a lender tells you that’s why you were turned
down, don’t assume that’s the end of the road for you and a loan. You still
might qualify for a loan with a different
don’t always offer every type of loan, so if you’ve been turned down by the
same bank where you’ve been keeping your cash, in many cases it’s not you, it’s
out someone that works for a non-depository institution and works with a direct
mortgage lender versus a bank. Mortgage lenders generally carry a larger
portfolio and would then have the ability to offer access to different programs
that you might qualify for,” says Corvi Urling, retail sales manager for Planet
with a strong credit score, lenders also look to see how much money you owe for
things like credit card bills, auto payments and student loans and compare this to how
much money you make. This is known as your debt-to-income ratio, or DTI, and it can
play a huge role in lenders determining whether you’re eligible.
example, if your wages are eaten up by high monthly bills, lenders won’t have
the confidence that you’ll be able to make your monthly mortgage payments.
of the time, lenders want to see a DTI of less than 43 percent. If you don’t
fit that profile, there are ways to overcome that number.
generation of homebuyers is far more likely to be saddled with debt from
their education, but it doesn’t mean they can’t buy a home.
it’s your student debt that’s holding you back, consider an income-based repayment plan, which can reduce
your monthly payment obligation. Some lenders may also have specific mortgage
loans just for doctors, who may have sky-high loans but typically also have
above-average salaries once employed.
wouldn’t stop buying clothes just because the first thing you tried on didn’t
fit, so don’t make that mistake with your mortgage.
a lot of folks that aren’t bad borrowers but just have credit issues,” says
Raymond Eshaghian, president of GreenBox Loans.
are mortgage loans out there for many different buyer profiles, and just
because a plain-vanilla 30-year loan might have been right for the couple down
the street, that doesn’t mean it is for you.
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