{"id":245385,"date":"2023-01-23T15:00:37","date_gmt":"2023-01-23T15:00:37","guid":{"rendered":"https:\/\/www.askpaul.ie\/?p=245385"},"modified":"2023-10-18T15:22:50","modified_gmt":"2023-10-18T14:22:50","slug":"mortgage-refusal-reasons-what-to-do-next","status":"publish","type":"post","link":"https:\/\/www.askpaul.ie\/mortgage-refusal-reasons-what-to-do-next\/","title":{"rendered":"Mortgage Refusal Reasons & What To Do Next"},"content":{"rendered":"\n\n[et_pb_section fb_built=”1″ _builder_version=”4.16″ background_color=”#4bbdcd” background_image=”https:\/\/www.askpaul.ie\/wp-content\/uploads\/2019\/03\/DevBanner.jpg” global_colors_info=”{}”][et_pb_row _builder_version=”4.16″ global_colors_info=”{}”][et_pb_column type=”4_4″ _builder_version=”4.16″ custom_padding=”|||” global_colors_info=”{}” custom_padding__hover=”|||”][et_pb_text admin_label=”Title and subhead” _builder_version=”4.19.2″ text_font=”Ubuntu||||||||” header_font=”Raleway|700|||||||” header_text_color=”#ffffff” header_font_size=”34px” header_line_height=”1.4em” text_orientation=”center” max_width=”1200px” module_alignment=”center” custom_margin=”-20px||-80px||false|false” custom_margin_tablet=”” custom_margin_phone=”” custom_margin_last_edited=”on|desktop” header_font_size_tablet=”30px” header_font_size_phone=”24px” header_font_size_last_edited=”on|phone” z_index_tablet=”500″ global_colors_info=”{}”]
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Mortgage Refusal Reasons & What To Do Next<\/h1>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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A mortgage rejection may be disheartening, but it doesn’t always mean you won’t be able to gain approval again.<\/span><\/p>\n

Here are some of the common reasons for a mortgage refusal & ways to help you resolve the situation and become mortgage ready.<\/span><\/p>\n

1. Your income is not high enough<\/strong>\u00a0<\/span>
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It\u2019s possible that your application was denied because your current income is not sufficient enough to repay the amount you wish to borrow. Under the Central Bank\u2019s mortgage lending rules, mortgage applicants are only permitted to borrow 4 times their gross annual income from January 2023 for first-time buyers. This goes for both single and joint applicants.<\/span><\/p>\n

For example, if you have a salary of \u20ac45,000, then the maximum mortgage you could be approved for is \u20ac180,000.<\/span><\/p>\n

However, you may be eligible for a loan-to-income exemption. From January 2023, 15 % of first-time-buyer lending can take place above the limits, 15%\u00a0 of second and subsequent-buyer lending can take place above the limits & 10% of buy-to-let-buyer lending can take place above the limits.\u00a0<\/span><\/p>\n

2. You don\u2019t have a full deposit\u00a0<\/span><\/strong><\/p>\n

The second reason you could find yourself receiving a mortgage rejection is that you don\u2019t have the minimum deposit required under the Central Bank of Ireland\u2019s loan-to-value limits. In Ireland, first-time buyers are required to have a deposit of 10%, while second-time and subsequent buyers require a 20% deposit.\u00a0<\/span><\/p>\n

However, you may be eligible for a loan-to-value exemption. This is when a lender reduces the deposit amount, so that instead you may be able to purchase the property with a smaller deposit. Lenders can offer loan-to-value exemptions to 5% of first-time buyer applicants who may have a deposit of less than 10%.\u202f\u00a0<\/span><\/p>\n

They can also offer loan-to-value exemptions to 20% of second-time buyers who have a mortgage deposit of less than 20%.\u202f\u00a0<\/span><\/p>\n

3. You have a bad credit history\u00a0<\/span><\/strong><\/p>\n

If you have a history of bad credit, you may struggle to obtain mortgage approval. This can happen if you didn\u2019t pay off previous\u202floans, or missed repayments in the past.\u202f\u00a0<\/span><\/p>\n

When you apply for a mortgage, a lender will run a check to view your credit history on the Central Credit Register (CCR). This report will show the lender your past and current credit commitments, and your capacity to manage and repay loans.\u00a0<\/span><\/p>\n

Your outstanding credit will help lenders assess your affordability, and can directly affect the amount you could borrow.\u202f\u00a0<\/span><\/p>\n

We\u2019d recommend that you review your credit history before submitting a mortgage application.\u00a0<\/span><\/p>\n

If you need to improve your credit history consider:\u00a0<\/span><\/p>\n