There’s a lot to think about when you’re planning to buy a home – and for a lot of people, getting a mortgage is at the top of their to-do list. If you’re in the process of buying a house, securing a mortgage needs to be a priority.
But it’s not always as straightforward as applying for a mortgage and being accepted. There are a number of factors that could make it difficult for you to get a mortgage. The good news is that knowing what they are can help you to avoid them, and that’s where Simpler comes in. We’ve put together this list of things that might prevent you from getting a mortgage so that you can increase your chances of having your mortgage application accepted.
1) Bad credit score
Maintaining a good credit score is essential, as it’s one of the first things lenders will look at when making a decision about whether to offer you a mortgage. They’re checking to ensure you’ll make payments on time, so a bad credit score is likely to be detrimental to your chances of getting a mortgage. While it’s not impossible to get a mortgage in these circumstances, it makes it a lot more difficult.
2) Unstable income
If your primary source of income is unstable – for example, if you’re self-employed – this can count against you during the mortgage application process. Having a full-time job is a great way to boost your chances – but with that said, self-employment doesn’t necessarily preclude you from getting a mortgage. If you can show that your income is stable and consistent, and is likely to remain so, your self-employment status shouldn’t pose too much of a problem.
If you’re in a lot of debt, lenders might suspect that you won’t be able to pay off both those debts and your mortgage. Try to clear as much of your debt as you can before trying to get a mortgage.
If you’ve filed for bankruptcy over the past few years, this will show up in your credit report, making it very difficult to obtain a mortgage.
Now that you’re aware of the things that can stop you from getting a mortgage, you may find you have more questions. As mortgage advisors in NZ, Simpler can help. If you’re looking for advice about getting a mortgage, don’t hesitate to get in touch with us and find out what we can do for you.