How soon can you apply for a mortgage after being declined?

In this brief guide, we are going to answer the question “How soon can you apply for a mortgage after being declined?”

How soon can you apply for a mortgage after being declined?

You can usually apply for a mortgage immediately after being declined but this is not advised as the mortgage lender who declined you would have carried out a hard credit check on you and this hard credit check will have left a fully visible imprint on your credit file which will be visible to everyone who checks your credit file.

If you are unsure of this or what your credit score is you can check to see if the mortgage lender left a hard credit check on your credit profile.

If you are unsure of what your credit score is then you should check your credit score from the four credit bureaus in the UK: Experian, Crediva, Equifax and Transunion.

Some of these credit bureaus may charge you a fee to view your credit report so what you can alternatively do is request a statutory credit report which is a free credit report which each credit bureau must provide to you upon you requesting it.

Alternatively, you can also use credit score services such as Checkmyfile and clearscore to check your credit report.

Applying for a mortgage immediately after you have been declined may, therefore, be risky as the new mortgage lender could automatically reject you as most automated decision-making systems may be programmed to reject borrowers who have previously had a hard credit check on their credit profile within a certain timeframe.

You should therefore either wait a few months or weeks before applying for a mortgage after being declined or you should at least request that the new mortgage lender carries out a manual underwriting check when accessing your mortgage application before they decide on whether to give you a mortgage offer or not.

A manual underwriting check will allow you or your mortgage broker the opportunity to provide more information in regards to your previously declined mortgage application.

This could greatly increase your chances of getting a mortgage offer.

You may also want to consider using a mortgage broker when applying for  a mortgage after been declined for a previous mortgage. 

A mortgage broker may know what so of mortgage lenders may be willing to consider you given the consequences.

Use a mortgage broker for your mortgage if you have been declined

You may want to use an independent mortgage broker to help you get a mortgage on your new home.

Mortgage brokers are important as they can access mortgage products from across the whole of the market in some cases.

This could be over 11,000 mortgage products. This may have some advantages rather than going directly to a mortgage lender.

A mortgage broker will look to understand your financial circumstances and then provide recommendations on which mortgage products may be suitable for you based on your mortgage affordability.

After giving you these mortgage recommendations, most mortgage brokers will seek your consent to apply for a mortgage in principle. 

This will allow you to shop for your home as more estate agents and sellers may take you seriously and it will also give you confidence that your mortgage is indeed a possibility before you make a full mortgage application. 

Once you have found a home you want to buy and are satisfied with the mortgage offer for your mortgage then the mortgage broker will then look to get you a mortgage offer.

This will come with a key facts illustration document that details the features of your mortgage including how much you will pay per month.

It will also contain information on if there are any limits such as early repayment fees, or annual overpayment limits.

If you are happy with everything you can then go on to secure your mortgage with the help of a conveyancer.

Your conveyancer will manage the legal searches on the property to ensure there aren’t any issues with it.

They will oversee the sales agreement to ensure it is in your best interest, they will manage the transfer of mortgage funds, exchange contracts with the seller or their conveyancer, and set a completion date with the seller or their conveyancer.

This will then bring an end to the conveyancing process, at which point you will receive the keys to the house and move in.

In this brief guide, we answer the question “How soon can you apply for a mortgage after being declined?”

If you need financial advice and you live in the UK then you could contact the Money Advice service over the phone or via chat for impartial advice.

You can also contact the debt charity “Step Change” if you are in debt and need help.