What to do if the bank declines your mortgage loan?


You recently got declined for a loan by the bank and that feels bad, like an insult. But, there could be several reasons why they did it. It may feel like a personal rejection but you must understand that financial organizations check a lot of things before they approve you. Your credit history is one of the most important things in it. 

So, fall out of the rejection and understand why your loan was not approved. Moreover, this is not the end of it as there are other ways of getting your loan approved. But, before sharing that let’s discuss the reasons for your loan rejection by the bank.

  • Bad credit history:

It is one of the most common issues with loan rejections. As a lot of people are unable to do their payments on time, they build up a history with bad credit and you seem like not the trustworthy person banks will approve of. It is one of the main reasons why people are going to “B” lenders nowadays or private companies for loans. 

  • Debt to income ratio:

Another reason for rejection can be your high debt to income ratio. It is a financial term and it means that your debt is higher than the money you are getting as income. You might even have a good record of paying your loans on time. But, the amount you are requiring from the loan can be bigger than you earn and can pay for installment. 

  • Employment history:

Financial difficulties are a part of life and you might have been facing them for some time. You could be one of the people who do not have a stable employment history. It does not mean you are not good at financing yourself or your family but the bank does not consider it a good thing for their client. 

  • Not matching the minimum income requirement:

You might be unable to match the bank’s minimum income requirement for mortgage loans. Every bank or financial company has some requirements that are a must for getting your loan approved. Therefore, people prefer “B” lenders as they make the process easy for you to get small and big loans. 

  • Not achieving the loan purpose:

You might be applying for a personal loan but some banks do not allow people to use the funds on other things like education or house renovations. So, make sure that the loan application you filled includes the actual and matching purpose for approval. 

Can you still get a loan approved after getting declined by the bank?

Yes, of course, you can. Nowadays, people do not rely on banks as their processes are hard and only some people can match their requirements. Even with bad credit history, there are “B” lenders that have been helping people out to get the loan approved. 

Some lenders might even provide the money themselves or get it from other lenders. It is a whole financial community that believes in giving you a chance to get rid of financial problems. So, try to find yourself reliable and professional lenders for getting your mortgage or any other loan approved.