Refused a mortgage?

Here’s how you can improve your chances

A rejected mortgage application can feel like a major setback. But you’ve still got options and ways to boost your prospects when you try again.  

If you get turned down for a mortgage application, you may well feel like you’re back at square one. The same goes if you pin your hopes on a set sum for a home – £200,000, say – but then discover you can only borrow £150,000. 

But these setbacks don’t mean you won’t get a mortgage in the future. 

Not passing a lender’s affordability test for a home loan is very different to not being able to afford a mortgage. Often you’ll find a clear reason for the refusal. Perhaps the lender decided you’re spending too much each month – leaving you without enough to manage a mortgage on top. Or it may have deemed your credit record unhealthy, or that you’ve got too much debt compared to your take-home pay.

In many cases, you can take steps to fix the problem – or consider alternatives if a small deposit or low income are limiting your ability to apply. We’ve five steps you can take to help improve your chances. It’s likely they won’t all apply to your circumstances, but they should at least get you into better shape for your next application.

A quick word of warning, though: it can be very risky to simply try again straight away with another mortgage lender (or two) in the hope you might get accepted. If you’re unsuccessful, having too many rejections in such a short period of time could damage your credit score.

Far better to wait until you’ve got a clearer idea of how you can improve your situation, and then reapply. 

Prove you can stay on top of what you owe

Having some debt isn’t usually a concern for a lender when you apply for a mortgage – what really matters is how you handle it

You’ll need to show you can look after repayments, pay promptly, and not spend beyond your means. There’s also ‘good’ credit and ‘risky’ credit – do you know the difference? And you might be surprised to learn what counts as a red flag. Our guide is full of tips to help you pay down debt faster, plus ways to improve your relationship with credit cards and loans. 

Look after your credit score (and it’ll look after you)

Mortgage lenders use your credit score as a way of making sure you’ll be able to cope with your monthly repayments. And as a rule of thumb, the higher your credit score, the better your mortgage deal. So how can you boost yours? Well, it’s based on your financial behaviour – and while you can’t turn back time, there’s plenty you can do now to improve your score.

Set out to supercharge your savings 

Feeling daunted by the size of deposit you’ll need for the home you want? Even putting together a 5% deposit can pose a real challenge for many. But even if it seems like mission impossible, there could be ways to chip away at your spending and build up your deposit. We can tell you the best type of accounts to grow your money – including a way to get up to £1,000 per year from the government – plus other tips to boost your savings.

Could family funds or shared ownership be the answer?

If buying a home in the traditional way doesn’t look likely, there are other ways to get your foot on the property ladder.

How about shared ownership where you pay rent to a local housing association? It won’t be for everyone but it’s worth finding out whether it could be right for you.

You could also consider our Family Springboard mortgage, where family or friends can help you with a deposit by acting as a guarantor. 

Prefer to talk to a real person? Try our Money Mentors 

We’ve guides and articles galore but sometimes a chat with a real person can be all the help you need. With our Money Mentors, you can book an appointment on the phone, via video call or in a Barclays branch. Then you can ask as many questions as you like, get great guidance and talk it all over with someone who understands. 

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