Did you recently find your dream home and apply for a mortgage, but the lender denied your loan? These three common mistakes cause loan applications to be denied and here's what you can do to prevent it from happening:
1. Wrong information in a credit report. Errors in a credit report are common and can cause your credit score to go down. You should get a credit report and look for mistakes. If something looks incorrect, you can file a dispute with the credit bureau to fix your report.
2. Not having enough credit history. If you don't have much experience with loans or credit credits, you probably haven't built up a history of making timely payments and this can ding your credit score. If so, you may want to get a credit card and make regular payments to improve your score.
3. Too much debt. A lender will check your debt-to-income ratio when considering if they will approve your loan. If much of your paycheck is already going to pay other debt such as a car loan and credit cards, that means you have less available to pay a mortgage. Try to pay down as much of your debt as possible to improve your credit score.
If you're trying to get a loan, the experienced professionals at Midland Mortgage Corporation are ready to help you through the loan process. To apply for a mortgage, contact them here.