My Loan Got Rejected – My Income Comes from Different Sources

by Oct 11, 2016First Home Buyers, Mortgages, Non-Bank Lending, Property investment

bank loan rejected auckland

Every day countless people have their home loan applications rejected from Banks, despite being able to provide a 20 or 30% deposit and easily meet the required mortgage payments. You may have even experienced this. If you earn commission from sales, have overseas income or simply don’t have the correct financial documents available for Banks, they will knock back your home loan application. Having multiple sources of income can be a great financial move, but it can be difficult when it comes to getting a home loan. Thankfully, you have an alternative option to get financing.

Why did the bank reject your loan application? 

Despite having the sufficient deposit an income stream, a Bank will still reject your home loan application if you don’t have the relevant or ‘right’ documentation. You could be earning commission from sales, overseas income or simply not have financial documents available, and in doing that you may earn far more than an office worker. But it doesn’t matter how much you earn, it matters where it comes from – according to Banks.

For example, you may be an independent real estate agent – you earn high commissions but not a regular salary. In addition, you could have invested in the sharemarket of a developing economy, such as China and be receiving dividends. Further still, you may be working as a bartender at nights. If you did all that, you could be earning well over $150,000 a year. Yet, you wouldn’t have the right paperwork, so the Banks would not provide you with a home loan. Thankfully, there are other options that are available at many income levels.

How else can you get a loan? 

While the Banks care where your income comes from, alternate sources of finance such as mortgage brokers can understand that it is how much you earn – not where it comes from – that matters. In fact, there is a specific type of loan for people who, as a result of having multiple sources of income, don’t have what Banks call the ‘right’ document. They’re called Lo Doc home loans.

What are lo doc home loans? 

Lo Doc home loans are just that – low documentation home loans. With a low doc loan, you don’t have to prove your finances. While they used to be available from the Banks, they are not providing people with lo doc home loans like they used to. Thankfully, they’re still available. iLender make low doc home loans available – and we will continue doing so. We understand that not having the financial records doesn’t mean you don’t have the income to meet mortgage repayments. Responsible lending means you still have to show bank statements and the ability to pay but you don’t have to show Financial Accounts which is what all the Banks require.

Your opportunities

If the Bank has rejected your home loan application because you didn’t have their required documents, you don’t have to miss out on the capital gains available in the housing market. There are houses available throughout Auckland, Wellington, Hamilton and Tauranga that are an excellent entry point to the financial market, which will begin your journey up the property ladder.

About iLender

At iLender we put your best interests first and not the Bank – our advice is unbiased as all Lenders who we do business with pay about the same in commissions.

Although we are Auckland based Mortgage Brokers, we help customers everywhere in New Zealand and overseas with buying property in New Zealand, as we are very much about online and giving advice here and now!

The 5 big benefits of Property Investing

Rental property is a popular and profitable form of investment. Buying the right investment property can provide strong capital gains and regular income, while being able to leverage real estate opens up new opportunities for creating wealth.  Thinking about...

How to get a mortgage when you are Self-Employed

There’s a lot to be said for working for yourself. Whether you’re a freelancer, contractor, or small business owner, striking out on your own offers a sense of opportunity that’s hard to find in salaried roles. However, self-employment can make things tricky when it...

Government Housing policy changes – March 2021

Can they work or is there ‘an elephant in the room’? A lot of comment has been made around the Government’s changes to Residential Property Investment over the last few days, so I thought commentary from me, with nearly 30 years in Property Finance, might bring some...

What kind of loans can I get with bad credit?

A few financial slip-ups in the past can have a surprisingly big impact on your credit rating. A bad credit rating indicates that you may be a risky borrower, which can make it difficult to get the bank’s approval when the time comes to apply for a home loan....

LVR changes and what do they mean for you?

Background In 2013 the Reserve Bank introduced LVR restrictions to curb a potential overheating of the property market. As a rule, owner occupiers needed a 20% deposit and investors 40%, later reduced to 30%. There was some leeway with banks able to lend a very small...

Getting a home loan: What to do when the bank says “No”

It’s easy to feel discouraged when a bank rejects your home loan application, but it’s important that you do have other options when it comes to securing a mortgage. Non-bank lending can be an excellent option for home buyers who have had their mortgage applications...

Credit searches – What to know before you apply for a Mortgage or Loan

All Lenders use a credit search as part of their assessment of a Mortgage or Loan Application and there are some things that are important to know. Some Lenders use a credit scoring system, some don’t. Credit Scoring Mainstream lenders use a credit scoring system and...

More Reasons To Be Cheerful

Upturn in House Prices… A couple of the major Banks are predicting house prices to increase by up to 7 per cent next year with the property market due to "spring back to life". This is a welcomed announcement as it comes on the back of a fairly quiet winter - so signs...

Can I get a home loan with bad credit?

Getting a mortgage can be challenging if you have bad credit or no credit history. Banks tend to perceive you as more of a risk and are generally less inclined to approve your home loan application.  But that doesn’t mean it’s impossible to get a mortgage. Here...

The truth about mortgages, interest rates, the housing market and everything else the media likes to sensationalise!

  'House prices down' 'First home buyers finding it impossible' 'Investors exiting the market' Such headlines are gross exaggerations and often blatant misrepresentations of the truth. The Housing Market This is flat, but stable. QV (NZ's leading provider of...

Best mortgage rates, 10% deposit owner occupied and 20% rental purchase, self employed with no financials and help for those with bad credit or arrears.

Hundreds of reviews on TradeMe and Google makes us your ‘Number 1’ choice.

Call 0800 536 337