3 Tips to Help Get Your Home Loan Mortgage Approved at Standard Rates

The statistics for rejection rates on home loans are now over 30%. Around a third of all home mortgage loan applications are rejected at the first hurdle. This has resulted in a steady increase in the amount of mortgage loans completed by so called "sub-prime" companies in the USA ( currently out of all home loans approved over 34% are issued by sub-prime lenders).

Why is it that some people get their mortgages approved with no problems whereas others often struggle, seemingly having to negotiate obstacles set up by the mortgage finance company, even then not getting the loan they want and having to approach sub-prime lenders with higher rates? What is the difference between a successful application and a rejected one? What are main stream lenders looking for when they evaluate your application?

The reality of the situation is, that getting your home mortgage approved really depends on how closely your circumstances match the criteria set out by the lender. All lenders have a set of "rules" or "criteria" that are used in deciding whether or not to approve a loan. Obviously, all applicants should at least show themselves to be creditworthy and be able to provide documented proof to support this. The FICO score is a popular credit scoring method used by many lenders (but not all - some have their own in-house credit scoring system, although most work in much the same way). The FICO scale runs from 300 to 850. The vast majority of people will have scores somewhere between 600 and 800. Above 720 or so means you will be offered good terms on mortgages, loans and credit cards.

Nowadays all lenders have a credit scoring system for aspects of your background, your credit "score" is derived from your background in the following areas:-