10 Factors Why the Loans of First Time Owners Are Rejected by Lenders

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Taking home loans is
undoubtedly a crucial step when you have decided to purchase your home for the
very first time. Applying for home loans involves research, keeping the
necessary documents ready, and most importantly, decision making. If you are
prepared before you are applying for a home loan, it is not only going to save
time but it will also be responsible for saving efforts. There might be a time
when you do not have enough knowledge regarding the paperwork as well as
formalities that are associated with a home loan. Apart from remaining ready
for your home loan, you also need to understand why your home loan application
can get rejected. To avoid application rejection, you must remain prepared and
stay away from making those mistakes that can lead to rejection. Given below is
a list of the factors as to why your home loan can be rejected. 
Unpaid dues
When borrowers take home
loans, two important factors that are involved and associated with approval are
the credit history and credit record. The check for credit history involves
understanding the payment of the EMIs of several other loans as well as whether
the dues have been cleared on time. The ideal way of clearing this condition is
by being punctual with payments. Also, it is suggested that you avoid missing
deadlines on the dues of your credit cards as well as the EMIs. You have the
option of keeping a track of the credit record by having proper knowledge
regarding the bills as well as repayment dues. 
Existing debts
If you have more than a
single debt associated with your name, the real income is going to be compared.
The lender is going to subtract the repayment of the credit from the income.
Based on the analysis of the lender, it will be decided whether your capacity
for repayment is adequate or inadequate. In case if it is inadequate, the
lender or the traditional lending institutions can refuse to offer loans to you
or reject your application if you have already applied for a home loan. 
Address on the list of defaulters
In most cases,
individuals move to addresses that were rented by other people, who might have
not paid the bills that were due or missed clearing their loan amounts. Also,
if the previous owner gives the same address to the banks or the previous
creditors, the address has been listed within the database of defaulters. This
is responsible for decreasing the chances of approval of the home loan. 
Job stability
If you keep changing
your job frequently, it can have a bad impression on your lenders. Lenders
prefer job stability because it is considered to be one of the main objectives
of approving home loans. Lenders insist that everybody needs to be employed in
one particular organization or firm for 3 years to receive approval for home
loans. In case if there is any problem with your organization where you are
employed, the home loan is going to be rejected. 
Age when you are applying
If your age is close to
the age of retirement, your home loan is going to be rejected. The reason
behind this is that lenders believe that once you reach the age of retirement,
you do not have the capability of repaying the loan. Some lenders can indeed
offer short-term home loans but the interest rate is going to be high.
Therefore, it can be said that the age of the borrower is going to play an
important role when the home loan application is being considered. 
Credit score
It is your
responsibility to keep the credit score high as it is responsible for playing
an important role in receiving approval for your home loan. You need to make
sure that your credit score is ideal when you are applying for a home loan. It
has to be above 750, as stated by www.forbes.com
Previously rejected applications
Your credit report will
also be responsible for recording incidents where you have already received
rejections for your home loans. These incidents become an important part of the
credit record. Therefore, you have to know whether your application will be rejected
before you are even applying for a home loan. This will help you to decide
whether you should apply for a home loan in any other bank. This will ensure
that you are correcting the mistakes and you are not repeating your errors when
you are applying for a home loan. Visit the website of https://www.libertylending.com/ to
know more. 
Income tax return filing
You must file an income
tax return every year, whether or not you receive an income tax form from your
employer. Every lender is going to check for clear track records of filing your
income tax return for the previous two years before they approve your home loan
application. Therefore, if you miss filing for your income tax return, you are
going to suffer because your home loan application is going to be
rejected. For more you can calculate your income tax by using calculator-online.net.
Suitable property for security
You need to know that
the lenders might not accept the different kinds of residential properties as
securities for your home loan. Properties that are responsible for having a
great resale value, a stable price, etc., are always going to be in demand
because they can be sold easily. Therefore, when you are choosing the property,
do not go for old properties. Also, check whether the property that you are
selecting has been constructed by a trusted and reputed builder. Make sure that
all the documents are submitted to you as and when required. If there is an
issue with the property that you are selecting, your home loan application will
be rejected. 
Mismatched signature
It is your
responsibility to make sure that you are signing all the documents by making
use of the same signature that is attached in all your documents. This is
crucial when you are applying for home loans. If there is any mismatch, the application
will be rejected. 
Conclusion
Home loan applications
can be rejected if you are not meeting the requirements. Consider the factors
that have been mentioned above so that you can make sure that you are avoiding
these unwanted mistakes. 

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