Buying a home is one of life’s biggest milestones. But while the excitement of house hunting is real, a mortgage rejection can come as a shock. For many, it feels like the dream is slipping away. But in most cases - the problem is fixable.
Lenders have to follow strict rules. They need to be sure that anyone borrowing money can afford the repayments now and in future. That means looking at income, outgoings, credit history, and even the type of property.
Understanding what stops you from getting a mortgage puts you in a much stronger position. In this guide, we’ll explain the most common reasons applications are declined. From poor credit and low deposits to job changes or affordability issues. We’ll also offer tips to help you avoid the same mistakes and boost your chances next time.
There are many reasons why a lender may decline a mortgage application (and even more things can go wrong after a mortgage offer). Below are the most common issues, and what you can do to avoid them.
Lenders review your credit history to decide whether you’re a safe person to lend to. It shows how you’ve handled borrowing in the past, including any missed payments, defaults, or County Court Judgments (CCJs).
Even small mistakes (like an unpaid mobile phone bill) can affect your application. More serious entries like IVAs or bankruptcies can make things harder, but not impossible.
Every lender has a different level of risk they’re willing to accept. That’s why one bank may reject your application, while another could say yes.
To prepare:
If you're applying with a history of bad credit, look into a bad credit mortgage or speak to a specialist broker.
High Debt-to-Income Ratio
Your debt-to-income (DTI) ratio compares your regular debt payments to your income. It helps lenders assess affordability.
As a rough guide, most lenders prefer your DTI to be under 40%.
If your monthly income is £2,500 and you pay £1,000 in debts, your DTI is 40%. That’s likely to raise concern.
High credit card balances, car finance, and personal loans are red flags. They reduce your borrowing potential and can lead to a failed affordability assessment.
To improve your DTI:
Insufficient Deposit
Your deposit size directly affects the loan-to-value (LTV) ratio. A low deposit means a high LTV - and more risk for the lender.
Most banks require at least a 10% deposit, but putting down 15% or more often gives access to better mortgage rates. If you have poor credit, some lenders may want a 25% deposit or more.
Ways to boost your deposit include:
Lenders want to see a stable income that’s likely to continue. If you’ve just changed jobs or work in a variable-pay role, it may raise questions.
As a rule, being in your job for 6 months or more is ideal. If you’re new to a role but in the same industry, you might still be considered.
For the self-employed, lenders usually ask for:
If possible, delay your application until your income history is well documented. A strong employment record improves your approval chances.
Affordability Assessment Failures
Even if your income looks high enough, lenders must check that you could still afford repayments if interest rates rise. This is called stress testing.
They simulate a mortgage at 6–7% interest and assess whether you'd still manage. If not, your application may fail.
To strengthen your affordability profile:
These steps show lenders you’re financially responsible and help you pass the affordability checks.
Sometimes it’s not you. It’s the property itself that causes a rejection. Lenders may refuse to offer a mortgage if the building has risk factors.
Common issues include:
A property valuation from the lender may reveal risks that reduce the loan amount or stop the deal altogether.
Before making an offer:
Making lots of credit applications in a short period can lower your credit score. Each “hard search” is recorded and shows lenders that you may be struggling financially.
A few checks won’t cause harm, but five or more in 3–6 months can raise red flags.
To stay safe:
Lenders like to see stability. A clean recent history helps your profile look stronger.
Registering to vote helps lenders confirm your identity and address history. It also strengthens your credit score.
Many applicants are rejected simply because they’re not listed on the electoral roll.
It’s free and takes five minutes at gov.uk/register-to-vote.
Before you apply:
Most lenders set a maximum age for mortgage repayments. This is usually around 70–75 years old at the end of the term. This can affect older applicants or those planning longer terms.
That doesn’t mean older buyers are locked out. Some lenders offer:
Make sure your age and income match the lender’s criteria before applying. Specialist advice helps here.
Mistakes in your mortgage application can cause instant rejection or delays.
These include:
Before submitting:
Small admin errors are easy to fix. But they can be costly if left unnoticed. Double-checking avoids delays and keeps your application moving
If your mortgage application has been declined — or you're applying for the first time — there are steps you can take to improve your chances. Preparing early and addressing key risk areas can make a real difference.
Start by reviewing your credit file at least three to six months before applying for a mortgage. This gives you time to correct any errors and improve your credit profile.
Actions to take:
A cleaner credit report makes you more appealing to lenders, especially if you're aiming for a competitive mortgage rate.
A larger deposit reduces your loan-to-value (LTV) ratio, which lowers the lender's risk and may unlock better deals.
Ways to increase your deposit:
Even increasing your deposit by 5% can significantly improve your mortgage options.
Use a Specialist Mortgage Broker
A mortgage broker can help match you with lenders that suit your personal and financial circumstances — especially if you’ve been declined elsewhere.
Brokers know which lenders are more flexible with:
Look for a broker who is:
With expert guidance from our team, you can avoid unsuitable lenders and target those most likely to say yes.
The most common reasons a mortgage is declined include poor credit history, a high debt-to-income (DTI) ratio, insufficient deposit, unstable employment, and issues flagged in the affordability assessment. Other factors like property type, multiple recent credit applications, or not being on the electoral roll can also affect approval. Each lender applies its own criteria, so being declined by one doesn’t mean you’ll be rejected by all.
Your credit history shows how you’ve managed borrowing in the past. Lenders use it to judge if you’re financially reliable. Missed payments, defaults, CCJs, or bankruptcy can lower your credit score and raise red flags. Even small unpaid bills can affect a mortgage decision. Reviewing your credit report in advance and correcting errors can improve your approval chances.
The debt-to-income (DTI) ratio compares your monthly debt payments to your gross monthly income. Lenders use it to assess affordability. A high DTI suggests you may struggle with repayments, especially if interest rates rise. Keeping your DTI under 40% improves your mortgage eligibility. You can reduce it by repaying credit cards, consolidating debt, or increasing your income.
Can I get a mortgage if I’m self-employed?
Yes, you can get a mortgage if you're self-employed, but you’ll need to provide more evidence of stable income. Most lenders ask for 2–3 years of accounts, SA302 tax returns, and an accountant’s reference. Being self-employed won’t stop you from getting a mortgage, but it’s important to prepare your documents early and consider using a specialist mortgage broker.
Yes, some property types are considered higher risk and may affect mortgage approval. Lenders often hesitate to lend on homes with non-standard construction, short leaseholds, or flats above commercial premises. A lender's valuation survey might differ from the market value and impact your loan offer. It’s wise to check the property’s suitability with your solicitor or broker before making an offer.
What Stops You Getting a Mortgage — and How to Overcome It
Being turned down for a mortgage can feel frustrating — even discouraging. But it doesn’t mean the end of your homeownership journey. In most cases, the issue is solvable with the right steps.
Understanding what stops you getting a mortgage is the first move toward fixing it. Whether it’s your credit history, income stability, debt levels, or the property itself, many common problems can be tackled with careful planning and expert advice.
Here’s a quick summary of the key points to remember:
If you've been declined or are unsure where to start, Tilly Bailey & Irvine can help. Our team offers clear, practical guidance to help you move forward with confidence. Book an appointment at one of our offices: Hartlepool, Barnard Castle, Stockton, Wynyard or Sunderland. Or arrange for a member of our team to contact you.
