Repeated Applications May be Required for Loan Approval

Fri, 22 Aug 2008

New research from GE Money Home Lending has shown that nearly three and a half million borrowers have had a mortgage or loan application rejected in the last 18 months. The findings suggested that of the 3.4 million borrowers in the UK who have seen credit applications refused, 412,000 have been completely unable to secure a loan or a mortgage through any company. The other 3 million borrowers, meanwhile, have been able to obtain a loan, but only after applications to several lenders . In fact, it is estimated that roughly one in eight borrowers has had to apply four or more times before being accepted.

Unsurprisingly, the research cites the credit crunch as the main cause of the refused applications, with the subsequent tightening of credit standards leading to an increase in rejections. The solution, according to GE Money, is for borrowers to use a mortgage broker in order to increase their chances of being accepted.

Gerry Bell, head of mortgage marketing at GE Money Home Lending, said, ‘Borrowers can increase their chances of making a successful application by using a mortgage broker or packager. With the rapidly changing mortgage landscape they can advise on which companies are likely to accept them and steer consumers away from making applications which are doomed to failure’.
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