5 Reasons Why Your Mortgage Could Be Denied
Buying a home is a dream for everyone at some point in life, and thanks to the different payment options available, that dream can become a reality. One of these options is a mortgage loan, offered by various financial institutions to make property acquisition easier.
In Colombia, banks such as Davivienda, AV Villas, Caja Social, Colpatria, Bancolombia, among others, offer this option to anyone who meets their requirements. Additionally, through their platforms, you can run mortgage simulations to evaluate your borrowing capacity and more.
Before applying for a mortgage, consider the following:
- Project your income so that the monthly payment does not exceed 30% of your earnings.
- Check the specific terms of the loan, including interest rate, administrative fees, insurance, and whether prepayments are allowed.
- Calculate the total cost of the loan so you know the full amount you will end up paying.
Things that may prevent approval:
- Poor credit history – This refers to your payment habits. Late payments, overdue debts, or unpaid obligations with other entities can negatively affect your application.
- Employment situation – Banks will require a work certificate proving you have been employed for 3–6 months at your current job.
- Loan exceeds your repayment capacity – Institutions review your monthly income, dependents, and existing debts to determine your ability to pay. If the loan exceeds this capacity, it will be denied.
- False personal information – Providing incorrect income or employment details can be verified through payroll receipts. Any discrepancies may result in the loan being denied.
- Lack of credit history – Never having had a loan or bank obligations may be a reason for rejection. In these cases, it is recommended to first acquire a credit card or a mobile plan and then apply for the mortgage.
With these five points in mind, we invite you to explore the real estate offerings at Mendebal by clicking here, and get in touch for guidance in purchasing your home and facilitating the mortgage process.