Give Me a Chance: 5 Ways to Maximise Your Chance of Mortgage Approval

If you are planning to buy a house, it is likely that you need to borrow money to fund it.

One of the stressful events in home buying is finding out whether your mortgage is approved or not. It will either make or break your chance to homeownership.

What adds to the stress of the home buyers is the mortgage process that requires a lot of your patience and paperwork but getting rejections at the end. To prevent this thing to happen and maximize your chance for mortgage approval, read on the article to know how.

Know and Buy What You Can afford

DTI is one of the bases for mortgage approval. It refers to the amount of monthly debt payments compared to the monthly income. In most cases, mortgage lenders allow a maximum DTI of 41% for mortgage approval. However, the ideal DTI ratio is no higher than 36%.

Calculate how much you can afford for a house and try not to stretch yourself too much. If you have higher DTI, it is likely that you will miss mortgage payments if emergencies arise.

Make a large down payment

Most mortgage providers give the lowest interest rates for people with large down payments. Homebuyers that can put down between 35%-40% of the property’s value have a higher chance of getting most of the top deals. Sadly, those that can put down only 10% have to pay a higher rate.

To increase your chance of mortgage approval, save as much as you possibly can to make higher down payment.

Prepare all the necessary documents

No mortgage lenders will transact business with someone who cannot prove who they are. Before applying for a mortgage, secure your documents that show your identity and address. Make sure you have an up-to-date passport and that it matches with your address on your driving license.

You can also use other documents like a recent letter from the bank or utility company that shows your address.

If you are employed, you need to provide your bank statements and payslips for the last three months as well as their P60s, a certificate of the employee’s annual pay and deductions.

If you have other incomes, you need to provide the documents to prove this.

Improve your credit score before application

One of the factors that the mortgage lender take into consideration is your credit score.

If possible, make your credit score as high as you can. Pay your credit card balances below 15% of the credit limit. Contact your credit bureaus to dispute negative account information if there is any. Otherwise, lenders might doubt your ability to keep up your mortgage repayments.

Shop for Multiple Lenders

Shopping for mortgage lenders will save you tons of money and help you look for a better deal. Most lenders do not offer the same mortgage rate and closing costs. So shopping for multiple lenders at least 3 or 4 is highly recommended.

Choosing the right type of mortgage loan also matters. Mortgage loans come in different shape and sizes. If you can afford the 20% down payment and has a good credit score, a conventional loan is best for you. It is the cheapest type of mortgage.


Applying for a mortgage loan is indeed one of the most stressful events a person may bump into. This process entails a lot of paperwork and requires your patience.

To make sure your effort will not be put to waste, it is necessary that you know the bases of mortgage lenders. Check your DTI and credit score. Comply with the necessary documents needed in the process. If you can make higher down payment, go for it. And lastly, know which type of mortgage that will work best on you.

Written by Maricor Bunal

Mari writes for Loansolutions to help educate people in making informed-decisions on taking out loans and becoming responsible borrowers. Being the COO, she feels it is her social responsibility to do so. Learn more from her as she shares tips, advises and stories on finance. Also, she's fond of 9GAG, so you might read some random stuff over here.

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