What to Do if You Were Denied a Mortgage Due to Credit Problems
Getting a mortgage is a big step, whether it’s your first mortgage or your fifth. You have to save money, maintain steady employment, and prepare for a major life change. After all, not many decisions are more important than deciding where your home will be.
And in light of the recent Equifax breach, it’s likely that even more people will be unnecessarily denied mortgages due to problems with their credit files – problems not of their own making.
So when your banker or mortgage broker tells you that your mortgage application was denied, what should you do?
Identity theft is one reason mortgage applications are often denied. With just your name and Social Security Number, criminals can open new lines of credit, take out loans, or even buy cars in your name. Up to 15 million Americans are victims of identity theft each year.
Mixed credit files also cause mortgage applications to be denied. This is when the credit bureaus combine your credit file with someone else’s. This is often when there is someone with a similar name or other similar identifying information. Rather than being the fault of a criminal, it’s the fault of the credit bureaus themselves. There are three major credit bureaus responsible for this, Equifax, Experian, and TransUnion.
Other inaccurate information in your credit file is a third major reason your mortgage application may be denied. This occurs when accounts are reported as past-due, in collections, or in default. The credit reporting agencies often “parrot” what the creditors tell them, and sometimes it simply isn’t right.
In any of these circumstances, what must be done – as quickly as possible – is get the information corrected with the credit bureaus.
The procedures for fixing inaccurate accounts can be complex, but with the right guidance – often with advice from a qualified law firm like Culik Law – it can be fixed, and you may be able to get your mortgage approved.
If your mortgage has been denied due to credit issues, contact us to see if we can help. We’ve dealt with all the major credit bureaus, and have helped many people get their credit back on track. Contact us to see if we can help you.