Are you hesitant to apply for a home loan due to fear of rejection? You're not alone. In the past year, one in five Australians has refrained from seeking finance, including mortgages, because of concerns about being declined. We explore the reasons behind this apprehension and offer advice on increasing your chances of approval.
Rejection is never pleasant. However, there are numerous occasions in life where we expose ourselves to the possibility of rejection. Whether it's applying for a new job or proposing marriage, the risk of rejection is often present.
Nonetheless, we take the plunge because the potential rewards outweigh the disappointment of being turned down. The same principle applies when seeking a home loan.
You might receive a rejection from a lender. But if you get approval, you're on the path to purchasing a home! This is worth considering, especially as a recent Finder survey reveals that over the past year, 19% of Australians have avoided applying for finance, including home loans, due to fear of rejection.
Concerns About Rejection That Worry Borrowers
The research highlights a particular concern among borrowers: the impact of rejection on their personal credit rating. Let's clarify this.
Being turned down for a loan is unlikely to affect your credit score—such a rejection won't even appear on your credit file. What is more likely to impact your credit rating is the act of applying for a loan itself.
When you submit a loan application, the lender typically performs a 'hard enquiry' on your credit report. These enquiries can lower your score and remain on your credit file for up to five years. Therefore, it's wise to limit the number of loan applications you make.
Even better, aim to get it right with just one application. This is where we can assist you.
Overcoming the Fear of Home Loan Rejection
Applying for a home loan can be nerve-wracking, especially when there's so much at stake. But if fear of rejection is holding you back, there's a straightforward solution: contact us.
We can guide you through your credit report, highlighting any issues that might concern a lender. If your credit score is somewhat low, we can provide tips on how to improve it.
Remember, though, that your credit score is just one aspect that banks consider.
We assess your overall readiness for a home loan, taking into account your income, household expenses, other debts, and a range of other criteria that vary among lenders. We review everything, help you smooth out any issues in your application, and match you with a lender and loan that suits your needs.
Whether you're in Townsville or seeking advice in Brisbane or the Gold Coast, we're here to help you navigate the process of securing a home loan. Don't let the fear of rejection hold you back
To learn more, contact Premium Finance Group Australia at (07) 4720 8888 or email us at finance@pfga.com.au.
Disclaimer: The content of this article is general and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your situation and may not be relevant to circumstances. Before taking any action, consider your particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced, or republished without prior written consent.
