What to do if your mortgage application is refused
What should you do if your mortgage application is refused?
If your mortgage application is refused, it’s not unusual and it doesn’t mean you’ll never get a mortgage. You have the right to ask the lender or broker for clear feedback on why you were declined, and you can use this to strengthen a future application.
A refusal does not in itself damage your credit history, but each mortgage application leaves a record on your credit report that lenders can see. Making several applications in a short period can raise questions for lenders, so it’s best to address issues such as income limits, deposit size, credit history or employment status before reapplying.
Taking time to save more, reduce debts or wait until your circumstances improve can make a big difference, and if you’ve had two refusals and meet certain criteria, you may qualify for a Local Authority Home Loan. For further support, consider talking to a financial adviser.
Why are mortgage applications refused in Ireland?
Common reasons include:
- Income not sufficient for the amount you wish to borrow
- Insufficient deposit
- Poor credit history due to missed repayments or unpaid loans
- Age limits set by lenders (typically loans must be repaid by age 65 to 70)
- Employment status (contract work, probation, job risk or new employment)
- Bank statements showing poor money management or excessive gambling
- Lender believes the property is overvalued
What steps can you take to improve your application?
- Save a larger deposit
- Wait until your probation period ends
- Pay off loans or credit cards
- Apply again when you’re ready
Improving your application may take time and planning.
Are there alternative options if you’re refused more than once?
If you’ve had two mortgage applications refused and meet other criteria, you may qualify for a Local Authority Home Loan.
Your next steps
To plan your next steps, use the CCPC’s free tools to check your finances and prepare for a stronger application.
- The CCPC Mortgage calculator helps you estimate repayments based on different loan amounts and terms.
- The CCPC budget section helps you better understand your income and spending.
These tools make it easier to understand what you can afford and identify areas to improve before reapplying.
Where can you get help with your mortgage application?
If you’re struggling, it may help to talk to a financial or mortgage adviser. They are experts in the mortgage market and will be well-positioned to advise you on the best possible lender for your situation.
Be cautious of unregulated mortgage advisers – check that they are authorised by the Central Bank of Ireland. Always ask for their “terms of business” before committing to them. Most do not charge a fee, but some do in certain complex circumstances, so be sure to ask up front.
