I'm here for initial advice. I hope you're well. In this session I'm going to talk about why you've been declined for a mortgage. If you google it, you know, mortgages decline or maybe on YouTube even for mortgages because why have I been declined. I would say a couple of times a week I get a phone call from an applicant to say look, I try to go down this bank and I've been declined. More, probably more, is I've gone to this bank via broker and I've been declined and I don't know why. So it's really, you know, I get a number of, and we get a lot of questions through this. So why have you been declined? Let me go through some of the main reasons why applicants get declined, okay? One, credit profile. But if you've been declined due to your credit profile, the lenders will generally tell you you haven't passed a credit score, okay? So that's what it is. You know, basically you've got something on your credit profile, you need to go and pull the credit report, make sure you get a multi agency credit report. I'll leave a link in our notes how to go and get that. Usually they're free for the first month and then they'll charge you. So yeah, go and get your credit report and that will tell it its own story. So that's one reason people have been declined. One reason is to do with affordability. Well, in all honesty, if you did your job properly or the broker did their job properly, they should know the affordability calculation, they should run the affordability calculation, they should know how things are treated. For example, secondary income, like bonus, commission and so forth. And a lot of times that's where the problem is. You're going with brokers that don't necessarily know their stuff. All you're trying to do is directly, whereby you're just putting the stuff but lenders may take 50% of the commission, 60% of the commission that may not take additional sort of whether it benefits and so forth. So how did they see your additional income? And that's really got the barrier because you think, oh, right, well, I'm getting 3,000 pounds a month, why they're not using 3,000 pounds a month. Well, a lot of the lenders have got different criteria. And if the broker has not done their checks, if they have not put their affordability calculations in with the lender beforehand and just sort of did it quickly, you get declined. So that's another reason, but these are pretty straightforward things of why you're getting declined. Okay. The third is around documentation. You've said you've got an excellent document and they don't like the document or they don't, you know, you've said you're earning, I don't know, 30,000 pounds. And then the documents, your SA302, if yourself employed, for example, and that's where the majority of the problems are because on an employed person, you generally can see the pay slips. On self-employed is much harder to sort of determine. You thought, okay, you've earned 30,000 pounds, but actually your SA302 or your tax calculation shows 15,000 pounds because, you know, you've got all your costs coming out. You've got various costs or you've brought losses from previous years. Now you might have earned 30,000 pounds. However, that's not what your account and your HMRC returns is and that's what the lenders go with. Okay, it's around documentation and proof of documentation. But the one that people come back with and say, I don't know. So the lender has not told me why I've been declined. That is more than most likely to be fraud-related. Now, when I say fraud, don't say, oh my God, fraud, oh my God, what's happened? Generally, it's because the lender doesn't believe you. Okay. Now, that could be a number of reasons. The typical ones that I get is you've gone for a mortgage application. Maybe why another broker? And you've gone to that lender and they've asked for your bank statement, pay slips, proof of income, you know, usual things. And then, either your broker has not disclosed the situation properly and generally has the case or, you know, you need to get this stuff agreed beforehand. What's your criteria around this? What's your criteria around that? The typical scenario is three months ago, you were on 25,000 pounds salary and right now you've been given a pay-roster 50,000 pounds and you're going for a mortgage application. That hits alarm bells at the lender. So I'm going to wait a minute. Why has that happened? They changed jobs. What's going on with that? So that's a big one. Big hike in salary just before a mortgage application. Job change with a big hike, okay? We'll self-employed on 15,000 pounds a year, declared by HMRC last year and now is on 60,000 pounds employed job in a very small company. What do I mean, small company? Because they don't believe them, right? Because the small company could be your uncle, cousin, friend who's employing you for 60,000 pounds, although you've never earned that money while your tax returns ever. And all of a sudden you're now employed in a company that's four salaries. And guess what? That company has only shown a tax return of 20,000 pounds profit. How they afford you paying you 60,000 pounds where they've only shown 20,000 pounds tax returns of profit for the last couple of years. Alarm bells, okay? So those are the reasons. So it's around documentation. It's around understanding the process of the lenders. Now generally people get employed, generally people salaries go up, generally people can get employed. There's no laws around being employed by smaller companies, but there needs to be a story around it. And also it's very important. The broker and yourself have a discussion about these risks, okay? Because once a lender gets suspicious about your income, they could put you on a shared database. There are databases, there's one database called Hunter whereby they can say, beware other lenders. We have declined this applicant and normally it says, could not verify income. It doesn't say fraud, it doesn't say anything like it just says we could not verify income. Okay? So once you go on that database, you go to the next lender and I'd see the trend, you know, some clients go to one broker and the broker applies for two banks and they get declined. And then they go, well, do you know what that broker was rubbish? Let me go and do this myself. And they go and do the third and fourth bank and all of a sudden they've got four declines on their report. Okay? If you're in the client, I haven't told you what it is. It's really important you do not start going down the lists. Okay? It probably means that the initial broker should have had that discussion because you should identify that you're high risk client. These are the issues with you. Okay? How do we make sure the lender is comfortable with the situation? So if someone came to me and said, look, I've just got a new job. By the way, I was earning 20,000 pounds. I'm now earning 40,000 pounds. There is a set of questions we need to ask and there's a set of questions that we need to make sure we get right for that lender, for the underwriter. So the underwriter understands this is the picture around it. Oh, by the way, I was a junior, I don't know, IT consultant. Now I've gone into a new IT firm. I've been given a big mandate now, a bit, big a salary because my role is in disaster recovery and at the moment that's something in high demand. Fine. That makes sense. Oh, by the way, the company has got 200 other employees. Fine. That makes sense. Okay? By the way, this is my CV and it's all related to these jobs. Hence, I've been making my way through it. You know, I started off on 20,000 pounds. I then got another job for 30,000 pounds and now there's 50,000 pounds and the underwriter will say, okay, well, I can see the progression of that. Okay? So it's really important. The broker really understands your position because different lenders will see things differently. And maybe that we go with a lender that's not got a computer, you know, a big factory setup, we go to a lender that's got individual underwriters that could understand these things rather than getting flagged up by computer system and going down the sort of compliance route of a lender without even having that discussion with anybody. Okay? So there are lots of reason why people get declined. You know, I've just touched on a few. But what you found out, hopefully, through this video is not all brokers are the same. There's a reason we do what we do. There's a reason we charge what we charge and there's a reason why people get declined. Okay? Always. Okay? So just because the lender hasn't told you that reason, that doesn't mean they don't know the reason. Sometimes the data protection acts, they can't actually disclose it to the brokers anyway. But generally, I don't think I've had any many that I couldn't work out why the applicants have been declined. So if you know what you're looking for, there's always a way where you can find out why you've been declined and try to deal with it. And that's really important. I would normally go back to the same lender that declined me. So the first lender that declined me, and if it's a genuine issue that we can resolve, I would resolve it with the first lender. So hang on a minute. This is the situation. I would wait three, six, six months, seven months a year and go back to that same lender. And say, do you know what? You didn't believe me. However, I've been here. Here's my pastives. Here's my P60. Here's my stuff. Here's my taxes that's been paid. Can you do the application? And we would obviously help that client get a mortgage through that. So it's really important things are dealt with, okay? And dealt with properly. And I hope you found this useful. Please like and subscribe to this channel. We talk about everything to do with mortgages, whether it's residential, vitality and commercial. Yeah, and I hope you found this useful. Thank you so much. The content of this video does not constitute giving advice. It's purely for information purposes. All cases should be discussed with a professional mortgage broker before applying. Niche Advice Limited is authorised and regulated by the financial conduct authority.