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Have you had a mortgage offer refused or declined by the banks?

Don’t worry, this is what we do best. We work with a wide range of specialist mortgage lenders and have successfully found solutions for 100s of people struggling to get a mortgage – whether your first mortgage application has been refused, or you had an agreement in principle that has now been declined.

You have decided that it’s time to get on the property ladder, thought about the type of property you want, maybe even started scouring Zoopla or Rightmove.

Buying your first home is an exhilarating milestone, but the process can also feel bewildering and, at times frustrating; notably if your mortgage application has previously been declined.

Declined Mortgage Glossary

Affordability: A calculation a bank will carry out to ascertain whether you will be able to meet your mortgage repayments consistently. LTV: ‘Loan to value’ refers to the price of a property after the deposit has been paid. Mortgage in principle: Statement from your lender confirming they are willing to lend a certain amount of money based on the information provided. Underwriting: The process of determining if the risk of lending is low enough to be acceptable. Stress-test: A test that reviews whether you could still make repayments if interest rates fluctuate.

What percentage of mortgage applications are declined?

Research published by a credit card company reported that one in five applicants have a credit application rejected. Of those, 10% had their mortgage application denied.

Not all banks are created equal; the lending criteria for a mortgage differs from lender to lender. So, do not assume that it is the end of the story if your mortgage application has been refused.

Why will a bank refuse a mortgage?

Banks tend to catastrophise. They assume the worst, at least when it comes to their customers! Accordingly, they do all they can to protect themselves from losing money, and if there is any doubt that the loan will be repaid, they can reject the application.

Assuming that you have met the basic criteria, such as:

  • Only wanting to borrow as much as the bank is prepared to lend according to your income
  • You have a sufficient deposit

There are several reasons a mortgage application can be declined, such as:

  • Inability to prove income or your earnings fluctuate
  • There are mistakes in your application, such as incorrect or mismatched information
  • You are self-employed
  • You are a temporary worker or hold a zero-hours contract
  • You are tied to various financial commitments
  • You are a foreign national without citizenship or indefinite leave to remain
  • There is no record of you on the electoral register
  • You have applied for the wrong type of mortgage
  • There have been recent instances of missed or late payments

Your mortgage may also be declined if your credit score shows that you have:

  • Been declared bankrupt
  • Have a county court judgement or default against you
  • Had loans or credit card applications rejected
  • Had a high number of credit checks
  • Missed or made payments late

These situations may cause a bank to lose confidence that you will be able to make the monthly repayments. Remember that the bank aims to make a profit, so they will shy away from most things that will put them at risk.

At what stage can your mortgage be declined?

A mortgage may be refused at different stages of the process, starting from the initial application to after an offer is submitted. The stage you reach before your mortgage is declined will impact the reason.

1) Mortgage declined after agreement in principle

Before you do anything, it is helpful to get a mortgage in principle from a bank. A mortgage in principle involves asking a lender how much they may be willing to lend. Once you know how much you may be able to borrow, you can gauge the type of property you can afford, and start searching house listings and booking viewings.

However, an agreement in principle is not a guarantee that your mortgage will be accepted. Instead, a mortgage in principle works to reassure sellers or estate agents that you are a serious buyer.

A mortgage may be declined after a mortgage in principle has been offered because something came up during a more in-depth search that caused concern. Some banks will explain why they refused your application when asked. However, if they decline to give a reason, your mortgage broker will be able to assess your financial situation and find a lender that is more likely to approve your application.

2) Mortgage declined by underwriter

Once you have found the property of your dreams within your price range, it is time to submit an official mortgage application. Unfortunately, there are multiple reasons why your mortgage might be refused at this point in the process, including:

  • Proof of income being insufficient
  • You are self-employed
  • Fraud market
  • Your credit score is low
  • The property in your application is unsuitable
  • Mismatching information

3) Mortgage declined following valuation

This can be a particularly frustrating part of the process for your mortgage to be refused. After all, you have found the property you want to buy and may have been daydreaming about moving day and relaxed evenings in your new space. Unfortunately, mortgage refusals at this stage are common.

There are a couple of reasons a mortgage is declined at this point in the process, such as the value of the property being higher than the mortgage in principle you were offered. Some lenders have LTV criteria, and if the value of the property changes and falls outside of the guidelines following valuation, the lender may have to pull out.

Valuations may uncover information that devalues the property, such as structural problems. In these instances, the lender may refuse the mortgage because the LTV is lower than you have agreed to pay.

4) Mortgage declined on affordability

In 2014, the Financial Conduct Authority carried out a Mortgage Market Review and, consequently, all lenders in the UK now have increased responsibility for the applications they approve. Therefore, if there is doubt regarding affordability, your application can be declined.

All banks will have a different set of criteria when calculating affordability; however, in general, they will consider your income and outgoings. Some lenders may also carry out a ‘stress-test’ so that they can feel confident you will be able to make the required repayments, even in the face of interest rates increasing.

5) Mortgage declined because of deposit size

It is widely accepted that the bigger your deposit, the more a bank may be willing to loan. This is because applicants with smaller deposits are considered to be riskier to banks who, of course, must protect themselves first and foremost.

To reduce the risk of your mortgage being refused, assess whether you need more time to save a considerable deposit.

6) Mortgage declined following the exchange of contracts

At this stage of the process, you may be breathing a sigh of relief knowing that you will be the owner of your dream property very soon. Unfortunately, a mortgage can be declined even at this stage.

It is rare for an application to be reviewed and declined at this stage, but it does still happen. The reason for this would generally be finding a problem, or even something suspicious, that was noticed previously. The good news is that this shouldn’t be a problem so long as there are no errors in your application or attached documentation and you are 100% honest about your income and outgoings.

Another situation would involve incredibly slow movement between the mortgage offer and completion. This will only happen if the mortgage offer expires, so you must understand when this will be and ensure the necessary steps are taken to avoid this outcome. Of course, sometimes, situations arise that are out of our control. If this happens, get in touch with the lender as soon as possible to discuss extending the offer or renegotiate the terms.

What to do if your mortgage has been declined

The first thing is to confirm why you were declined, as this may not be revealed initially. Once you understand what has happened, you can approach the right mortgage lender or make a plan of action to increase the likelihood of your next application being approved.

Every mortgage application requires a hard credit check, which impacts your credit score. Therefore, it is essential that, after your initial application is declined, you take steps to prevent the same thing from happening again.

Remember that a bank aims to make a profit, so they will shy away from most things that will put them at risk. If your mortgage has been declined, or you are concerned that it may be, get in touch with a mortgage broker who has extensive contacts with a variety of banks and lenders.

When you contact the team at AMS, we will use our years of experience to ascertain which lenders will be the best match for your situation.

Additional reading

Mortgage FAQs Housebuying How to get a mortgage with CCJ’s and defaults

There are many more reasons why you may be having difficulty and what you do next is important, so don’t worry and give one of our expert mortgage advisors a call on 0121 4000 052.   We are experts in helping clients to secure freelance or self-employed mortgages. We typically approach lenders who we know are willing to look beyond the accountant’s assessment and take a broader view. Call us now and speak to one of our team who can talk you through your options.

Want to get started?

Choosing the right mortgage for you can be really tricky. At ams: our expert advisers guide you through the process. Simply, efficiently and professionally.

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As a guide, you could potentially borrow around:

The figure above is calculated based around current lender criteria and may not be representative of the actual figure you may be able to borrow.

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Mortgage Refused FAQ

Can you get a mortgage, even after being refused?

Yes. We at ams: help hundreds of people each year. Please call us for further advice.

Do I need 3 years account before I can be considered?

Not necessarily as we have lenders who will use 1 years accounts.

Am I considered to be high risk?

Again, not necessarily as most lenders will offer the same rate to self employed as employed. As brokers we know which lender’s criteria will suit your requirements.

Will I need a larger deposit as I’m self employed?

No. Each case is assessed individually and we even have lenders that will offer mortgages up to 95%.

If self-certification mortgages no longer exist am I excluded from getting a mortgage?

No, there are alternatives.

Do all lenders cater for the self employed?

Whilst the criteria will differ between lenders, e.g. number of years accounts required, they will all generally consider self employed applicants.

Can I still get a mortgage if I have been declined by my own bank?

Speak to us at ams: – whilst one lender may decline another could accept.

Can I get a mortgage if I have no proof of income?

Since self certification mortgages ended some occupations can provide proof of income other than accounts. All lenders will require some form of proof so speak to ams: about how it would work for you.

How do I prove my income now?

If you’ve only been trading a year, there are still mortgage lenders that will lend to you with 1 years accounts.

My situation is complicated, are you able to help?

Always call us as this is where we specialise, at ams: we have access to underwriters where we can talk cases through with them on an individual basis

So what income can I use?

Sole Trader

  • Net profit (if using accounts)
  • Profit from self employment (if using SA302s)

CIS / Sub-contractor

  • Where you have been subcontracting to the same company for the last 6 months we have options for you to raise a mortgage based upon your earnings from your pay slips (so effectively you are treated as an employed person)


  • Your share of net profit (if using accounts)
  • Your share of total income received (if using SA302s)
  • Profit from self employment
  • commission

Ltd Company

  • Your share of director’s salary
  • Your share of dividends
  • Occasionally lenders can consider net profit if there has been a large business expense or a sum earned but left in the business and not withdrawn.


  • gross basic income
  • bonus
  • overtime
  • commission
  • car / town / shift allowances
  • mortgage subsidy
  • other cash employer benefits

Other Forms Of Income Considered

  • Investment income
  • Rental income
  • Trust income earned overseas
  • Income eaned in a foreign currency
  • Bursary
  • Pension
  • State benefits
  • Many others!
What income do I need if I am buying a property to rent out?
It will vary from lender to lender but you have more chance of being considered if you are a home-owner or experienced landlord.

Talk to the mortgage experts.

Call 0121 4000 052

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