Homeowners everywhere have been looking into refinancing recently due to low interest rates, and other financial reasons. However, only about 1 in 10 refinancing applications get approved. With so many rejections, many homeowners want to know, “What do I do if I have been rejected for a mortgage refinancing?”
Well first, you should be aware of some of the bigger reasons homeowners get denied when trying to refinance a home mortgage. Typically, rejections result from a homes value, condition, and neighborhood, as well as the lenders credit, loan to value ration, and income. Many homeowners have a home that is worth more than its own market value, or have a bad ltv (Loan to Value) ratio, and that is the most common reason for rejection. Also, many homeowners have a reduced income, or have seen their homes value drop as a result of the economy. These factors play a big role as to reasons why homeowners get rejected when refinancing.
If you are denied a home loan refinance, do not take it too personally, its business. Get your finances and information in order, and try again. To do this, check your credit rating for any mistakes or debts which you have paid, but are still lingering on your report. These are common things that homeowners find all the time, and can save you money, or get you an approval, if they are corrected.
Also, check your outstanding debts, and see what you can do to minimize them. The fewer dollars you owe, the better your ltv rations can be, which will help you get approved. Mortgage refinancing is not the most complicated thing in the world to understand. Mortgage lenders and banks simply want to know you can pay back the loan, how you can pay it back, to make sure you aren’t to riddled with debt, and that the home is actually worth its price. Getting a mortgage refinancing approval is not as hard as it may seem, even for homeowners who have been rejected. Practice patience and do a little research to get increase your chances of approval.