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Majority of people refused a mortgage

A vast majority of mortgage enquires come from people who have been refused a mortgage due to not being a ‘perfect candidate’, according to Mortgage Experience.

The mortgage broker, which found 72% of its enquires are from people whose mortgages have been rejected, found other reasons include being self-employed or not meeting what is still a strict lending criterion.

Shaun Evans, chief executive officer of Mortgage Experience, says: “While it’s obviously critical to ensure people buy based on what they can afford, this difficulty in getting mortgages or becoming a prisoner to an existing mortgage on a high rate, is still a major issue.”

A report from Which? revealed that one in six current mortgage holders have been refused a mortgage in the past, further supporting the broker’s findings.

A separate YouGov study for Together stated that 54% of potential home buyers dropped out of the process because they were unable to get a loan to buy a property.

“I’ve seen people denied mortgages simply because of their employment type, particularly if they are self-employed,” Evans continues.

“The issue we have is that the mainstream criteria set down doesn’t really reflect changing trends in the market, with what people want to buy, how they work and how they spend.”

According to Evans, common reasons for being denied a mortgage are either based on credit history, employment status or having an inadequate deposit.

However, he says the secret to actually getting a good mortgage deal is to shop around. He adds: “Brokers are one of the best go-to points because they’ll look at what your personal circumstances are and use their own knowledge to find the enders that will offer the best deals to candidates.”

He also advises to look at how much deposit can be put down, as well as taking simple steps to improve a credit rating, such as registering to vote, paying on time and getting rid of unused credit sources.

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