LoanOwning a house is every person’s milestone. This may not only come once, but on different times an opportunity for a lifestyle change arises. Despite the lack of funds, a person may pursue a house upgrade or refinance through mortgage loans.

City Creek Mortgage identifies three types of uses a person may apply the loan for. Each use entails a different requirement and difficulty of application. There are times when, despite your confidence with your request, you received a rejection anyway. The lender should provide you the reason for the denial, but as the borrower, you should be aware of want went wrong.

These are possible circumstances and ways to avoid it on your request:

1. Low credit score –Most lending companies require a minimum of 680 credit score. On the other hand, there are companies that are willing to help you improve your record. To do this, you should be able to keep a good record with your credit issues, especially on punctual payments. Just be careful on paying the debts too close to your application as this may still raise suspicion in your lender.

2. Poor credit history –A part of your computation for your credit score, your history also serves as a standalone factor in your application. This involves all your records from all types of credit transactions. To know your credit history status, you may check in online through AnnualCreditReport.com.

3. Low debt-to-income ratio– The number of your outstanding debt against your income is another determining factor of your application’s approval. Unfortunately, most people fail to support their income to come up with a high DTI ratio. If you are self-employed, be sure to keep a record of your income to backup this factor.

Overall, guaranteeing an approved loan requires a good record on credit history. To better amp your chances, you should be able to support this by paying your debts, whether through loans or credit card, on time for a long time. You should also be able to document your income to prove your capability of paying the lender back. With these things in place, you may now prepare your application.

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