Having your home loan application rejected is daunting and seemingly suspends your hopes of owning a new home in Singapore. However, that doesn’t mean you’re less fit to qualify for the financing than the rest who received the nod. Sometimes, a loan’s eligibility requirement can be too punitive for the tiniest of missing details and potentially get your housing bank loan application tossed aside. Perhaps you could give it a try again and be successful. But if the banks reject your application, here are the reasons for that.
1. Error in the Credit Report
Errors in credit reports aren’t so common but not entirely non-existent. Remember, it’s humans documenting your financial history and is prone to making mistakes, tarnishing your credit report, and denying a good credit score even though merit doesn’t indicate that. Banks are usually too cautious when lending money and want guarantees for repayments, which means having a spotless credit score.
2. Lower Valuation of the Property
Developers sometimes price buildings way more than they should pay for their financial gains, lest they know how dreadful that can be to your housing loan application. As landlords indicate, banks don’t commit to giving out cash without doing routine assessments and validating the price. If perhaps they find the actual evaluation being lower than mentioned, they’ll undoubtedly reject your application.
3. Existing Liability
Banks dread loan repayments and will suddenly withdraw, rejecting your application if your debt to income ratio exceeds 30 percent. However, some financers in Singapore can be somewhat lenient with liabilities, and you can visit https://dollarbackmortgage.com/housing-bank-loan/ if you feel burdened with debts. Having an excellent credit score increases your chance of getting your loan application approved since it indicates lower liabilities.
4. False or Incomplete Documentation
Banks love working on merit and appreciate honest documentation to determine whether or not you qualify for a loan. However, doing the opposite removes you from the equation, and you certainly won’t get the nod for a housing bank loan. Also, your lender has viable reasons for asking for complete documentation since it gives them a precise picture of whom they’re handing their money. Incomplete documentation can therefore deny you the chance for loan approval.
5. Poor Repayment Ability
Remember, bad credit scores result from poor loan repayments and defaults. And while you may be servicing your loans diligently, it’s pretty easy to forget about the loans you guaranteed others on. If you default on payments on co-signed loans, a massive chance for a potential loan application rejection exists.
6. Co-Applicant’s Lower Credit Score
Sometimes, the fault may hardly be on your side, and your co-signer may have a taunted credit score with a poor loan repayment history. That can throw you off balance since it negatively impacts your housing loan application, and you won’t get the financing you need. Therefore, it helps to select your co-signer to guarantee approval on your loan wisely.
Conclusion
Getting your bank to approve your housing loan application brings you joy, but that can sometimes feel impossible. Banks have rigorous and stringent vetting criteria such that even the slightest indication of a red sign drives them off. Therefore, always be sure of the requirements and play by their rules if you want your housing loan application approved.
