Acquisition of housing with the help of mortgage lending is a rather serious help for young families, but not everyone is able to get this type of loan. About 80 percent of potential clients are denied a mortgage loan. This is due to the fact that each bank has its own specific requirements for people who want to get a loan for housing. And if the borrower does not meet these requirements, the bank has the right to refuse to issue a loan.
The most common reasons for refusing a mortgage are:
1. The candidacy of a person who wants to take out a loan does not meet the basic requirements of the bank for borrowers according to various criteria.
In particular, the age of the borrower must be between 21 and 75 years old. Moreover, given that a mortgage is a long-term loan, lasting from 10 to 30 years, the upper limit of the age norm refers not to the beginning, but to the end of the term of the mortgage agreement.
There are also strict requirements for seniority, both general and seniority over the past 6 months. The total work experience of a potential borrower must be at least one year, and work experience at the last job must be at least six months.
2. Bad credit history or no credit history at all.
If a potential borrower has had repeated violations of the repayment schedule for previous loans, or there is an unpaid loan at the time of taking the mortgage, this is a reason to refuse to issue a mortgage loan. If a person does not have a credit history, the bank is not able to check how good the client is and how solvent is, therefore, in this case, a refusal is also possible.
3. Inconsistency of the guarantor with the bank’s requirements. Since the guarantor is the person who is charged with the obligation to repay the loan in the event of default by the borrower, the bank must be sure of the guarantor’s solvency.
4. The presence of typos, clerical errors, blots and other errors in the documents presented to the bank for registration of the mortgage agreement.
5. The potential borrower has unpaid fines and tax arrears.
6. Inability of bank employees to contact the borrower’s management or relatives by phone numbers indicated in the questionnaire. In the application for the issuance of a mortgage loan, the borrower indicates data about the place of work, contact work phone numbers, as well as information about relatives and their contact details. All this information is checked, therefore, it is necessary to warn all those indicated in the questionnaire about possible calls from the bank. If someone fails to get through, this will be a reason for the bank to refuse to issue a mortgage.
7. Providing forged documents.
8. Poor health of a person who wants to take out a mortgage. Frequent sick leave, the presence of serious and potentially life-threatening diseases is one of the reasons for bank failures.
9. Inconsistency of the acquired housing with the requirements imposed on it in terms of the state, level of wear and tear of the building, as well as problems with the presence of debts, encumbrances or illegal buildings.
