QandAs: Loans

I was turned down by a Mortgage Lender, what should I do?

Answer:
If you are turned down by a mortgage lender

, the first thing you should do is ask to see a copy of your credit report. Verify that the information on the report is an accurate representation of your credit history .

If you find errors on your credit report, you will need to contact the organizations reporting erroneous information and let the three major credit reporting agencies know that you have filed disputes for specific information. Be aware that it can take several months to get erroneous negative information removed from your credit report.

Whether or not you found problems on your credit report, you should ask a trusted mortgage lender to go over the data on the report with you, so you can come to understand why you were not perceived to be a good credit risk. Your mortgage lender may be able to offer specific suggestions about things you can do to improve your credit.

If you can't get a satisfactory answer regarding why your loan wasn't approved and you feel that your debt ratio and payment history are well within acceptable ranges, you may want to apply with another lender. However, you should proceed with caution when reapplying for credit. Every time you apply with a new lender, that lender will pull a new credit report on you. Multiple credit checks for financing purposes can have a negative impact on your credit score.