Receiving a loan rejection letter can be quite frustrating. In case your mortgage loan application is rejected, don’t feel discouraged and give up your dream of buying a house. Despite this rejection, you can always go back, review your application, identify the problem, and make the appropriate changes.
6 Steps to Take If Your Mortgage Loan Application Is Rejected
Below, we've listed 6 steps you can take if your mortgage loan application is rejected.
1. Review the Denial Letter
Review the reasons why your application has been rejected. Your denial letter will cite the reasons why your application has been rejected and often make suggestions on how to get accepted in the future.
2. Ask for Reasons
The most common reasons of denial are bad credit or insufficient income. Understanding the reasons will help you understand where change is required. If these reasons are rectifiable, you can take the necessary steps to adjust.
3. Understand the Problem
Once you identify the problem, you can start taking steps to rectify it. You can improve your credit history or improve your monthly income to become eligible for that loan program. If these are not the issues, you can definitely also hunt for another lender.
4. Contact Another Lender for a Solution
Not every lender follows the same set of regulations. Thus, you can always speak with another mortgage lender for a solution. There’s also a chance that you might fit in the parameters of another loan program.
5. Ask About a Different Type of Loan
In case the loan program that you’ve chosen might not be the right fit for your financial requirements, there are other options, including financial assistance. In such cases, you can always inquire about a different type of mortgage loan program that is a more suitable match for your financial position and objectives.
6. Re-apply for the Mortgage
After careful consideration and the recommended adjustments above, you can re-apply for the mortgage loan. However, be vigilant and consider seeking the help of a mortgage expert while filing your application form.
Read Also: The Dos and Don’ts of the Mortgage Process
Drew Mortgage Associates, a leading mortgage company in Boston, have a panel of experts who can guide you in the mortgage loan application process. In case your application has been rejected, our team can help you review and revise your application process and shop for the right mortgage loan.