There are very few people out there who can afford to pay the entire amount in cash when buying a house. Most people rely on a mortgage in order to buy a house. The mortgage applications are getting stricter. So, you should know the reasons why your application might be rejected in order to increase your chance of getting a mortgage.
Poor credit score
A good credit score is vital to getting a mortgage. If your credit score is not good then you won’t get a good interest rate. If it falls below a certain number, your application may be rejected. Before applying for a mortgage you must make sure that your credit score is good. You should pay off all your debts and pay your bills on time in order to improve your credit score.
Insufficient down payment
In order to buy a house, you need to pay a percentage of the price of the house as down payment. It is usually 20% of the house price. If you fail to give this amount then your mortgage application might fail.
Income
You must demonstrate that you have good monthly income in order to pay your mortgage fees. So, if you have a low income you have a less chance of getting your mortgage application approved.
Before you apply for a mortgage, it is better to consult a real estate agent so that you know everything about the mortgage. Basically, you need a good income source, good credit history, and sufficient down payment to increase your chances to get a mortgage.