Synopsis:The best thing to do is to work with a professional who can help you make sure your picture is good before you apply and work with you over time to fix any problems. In other words, work with a real person who has been referred to you by someone you trust, not the latest bait and switch sales pitch on-line. Contact me if you need the name of a local professional who cares about their clients
From: The New York Times
After a rejection
Some borrowers think that because their mortgage application is turned down the
first time, they won’t ever be approved. In reality, some borrowers
succeed on the second or third attempt, usually with a different mortgage
professional, and often several months later, after they have saved more money
for a larger down payment or improved their credit score.
Making sense of the
story
- Before reapplying for a
mortgage, borrowers are advised to look at the reasons they were initially
rejected. - The Equal Credit
Opportunities Act requires lenders to give loan applicants specific
reasons in writing within 30 days of their decision. If it’s based
on a problem in the borrower’s credit report, the lender must tell the
borrower the name and address of the credit agency that provided the
information. - Talking to the loan officer
who denied the application to see how close the borrower was to being
approved also can be helpful. Sometimes the gap is small and could
be bridged with a larger down payment or another home appraisal, for
example. - It also may be worthwhile to
shop around for other lenders. Borrowers can work with a mortgage
broker or an online network like LendingTree or Zillow’s Mortgage
Marketplace. - A credit union also might be
a better bet for some applicants. Credit union loan committees may
permit better deals for longtime members; they might also modify loan
terms for borrowers they already know. - However, first-time buyers
may need to scale back their aspirations. One reason people get
turned down for a mortgage is because they try to buy more property than
they can afford based on current incomes. - Applicants also should look at ways to
strengthen their financial picture. If a borrower’s credit is poor,
paying down credit-card balances can help to increase a FICO score.