Barclays Rejected My Mortgage Application: What Should I Do?

Whether it’s Barclays, Natwest, HSBC, or any other popular high-street lender, being refused a mortgage can feel like a massive setback in your mortgage journey.

But don’t worry – having a mortgage application refused is much more common than you think and is certainly not the end of the road.

Whether you’re a first-time buyer, an established property owner, or simply looking to move, it’s easy to get overwhelmed by the paperwork and pragmatics of securing your ideal mortgage.

So what should you do in the case that your mortgage application is rejected?

In this article, we’ll take a deep dive into everything you need to know about the next steps after your Barclays Mortgage mortgage application was rejected, why your mortgage application might have been declined, and the steps you can take to increase your chances of being approved in the future. Let’s jump in.

Is Getting a Mortgage with Barclays Simple?

It’s very difficult to answer whether it is simple to secure a mortgage with a specific lender as it will wholly depend on your specific financial circumstances and each lender will have their own criteria that you will have to follow.

As one of the leading lenders in the UK, it comes with no surprise that many borrowers will look to secure their mortgages with Barclays. However, as a popular high-street bank, Barclays can often be much stricter than other comparable lenders.

In short: To meet the Barclays mortgage criteria, they will assess your application on several factors, including:

• Affordability
• Income Verification
• Credit History
• Deposit Size
• Property Valuation

If you are able to meet the Barclays lending criteria with ease, then you’re likely to find securing a mortgage with Barclays very simple.

For those who need certain adjustments, such as having multiple income streams count towards their overall affordability or self-employed factors to take into consideration, your application can start to look more complex.

In the case that your financial profile does not align with the popular high-street ‘one-size-fits-all’ lending criteria, then using a specialist lender could be advantageous for your next mortgage application.

Why Has Barclays Declined My Mortgage Application?

While finding out that you have been declined a mortgage by Barclays can leave you confused, understanding the reasons behind your application being refused is the first and key step in moving forward.

As such, it’s important to take a step back and evaluate why this happened. While there are a variety of reasons that could lead to Barclays refusing a mortgage application, some of the most common reasons include:

• Incomplete or missing documents
• Low credit score or poor credit history
• Insufficient income or too much existing debt
• The property type

In the next section, we go into detail on the most common reasons why mortgage applications get rejected, potentially highlighting why Barclays refused your mortgage application.

What Are the Reasons for Getting a Mortgage Rejected by Barclays?

To better understand why your mortgage application was rejected, let’s explore some of the most common reasons behind why Barclays might not have approved you as a borrower.

Poor Credit History

One of the most common reasons for a Barclays mortgage decline is a poor credit history.

Much like any lender, when you submit a mortgage application, Barclays will assess your credit score in order to determine your creditworthiness. Essentially, this will look at any missed payments, existing debts, or issues on your credit report.

Lenders will want – and certainly prefer – to have borrowers with a reliable credit history that demonstrates a pattern of responsible crediting. If for any reason you’ve missed payments in the past or have high levels of debt, this will naturally place you in a much riskier category to lenders.

If you believe that bad credit could be the reason for your mortgage rejection – don’t worry. There are some quick and easy steps that could help you find out:

1. Check your credit report to make sure there are credit faults.
2. You can use main credit reference agencies, such as Experian, Equifax, or TransUnion for a complete credit report.
3. Following your own credit check, highlight any areas of improvement that you could actively start addressing. This could be making efforts at paying off debt, cancelling or amending ongoing transactions, or even avoiding new debts.

By taking the time to review your credit report you will be able to subsequently work on improving your score before reapplying for your next mortgage.

Affordability

Alongside your credit history, Barclays will also need to be certain that you can actually afford the mortgage loan that you’re applying for.

Each lender will do this through what is called a mortgage affordability check, and each lender will have their own criteria regarding their checks. Generally, however, this will look at your income vs outgoings, and any existing debts to assess whether you would be able to comfortably afford the mortgage repayment.

Notably, high-street lenders like Barclays will be asking can you ‘comfortably’ repay the mortgage loan. This is because there is a certain amount of room that is allocated for any changes in circumstance and so that your mortgage loan does not put you in a financially overbearing position. Reliability and consistency are the key factors that lenders will be looking for and it’s important to bear this in mind when completing your mortgage application.

Should your monthly commitments (like credit cards or loans) be too high, or if your income is too low for the amount you are requesting, your mortgage application may be declined due to affordability concerns.

Employment Issues

As we mentioned earlier, Barclays’ criteria – like many other high-street lenders – is designed to fit the majority of borrowers. As such, if you’re self-employed or have an unusual financial setup, then your mortgage application might be more difficult.

The core of any mortgage application is to provide proof to your chosen lender that you can reliably repay your debts. Providing proof of an established employment with consistent income will help project a strong financial profile, making lenders look more favourable on your application.

For self-employed, Barclays typically looks for a minimum of two years’ worth of income proof to accurately determine your expected annual income, though you may also need to provide additional documentation to verify your income.

If you don’t fit the typical income structure or are unsure about how much of your financial income is contributing to your affordability calculations, it is always best practice to reach out to a mortgage broker for help.

Working with a trusted mortgage broker – like Boon Brokers – can help you understand the affordability calculations and ensure that all the necessary information is presented clearly to Barclays or any other chosen lender.

No Deposit

A Barclays mortgage deposit will typically need to be at least 10% of the value of the property.

In the case that you don’t have a deposit, or have a low deposit, it is likely that this will be the reason for your mortgage application being refused.

There are many lenders – including Barclays – that do sometimes offer certain lending schemes to selected borrowers. This can sometimes be beneficial if your application is strong on all other accounts, excluding your available deposit.

Most notably, however, having a larger deposit will most likely unlock better and more competitive interest rates. As such, it is almost always best practice to ensure you have a sizable deposit, before reapplying for another mortgage loan.

Other Reasons?

While we have explored the most common reasons behind why Barclys might reject a mortgage application, sometimes, the reasons for mortgage rejection can be less obvious.

In some cases, a mortgage refusal could be down to:

• Missing documents: Any missing documents or absence of proof will result in an application denial. Make sure everything is in order before applying.
• Property valuation: If Barclays value your property as less than the mortgage you’re applying for, it could lead to a refusal.
• Age restrictions: Barclays, like many other high-street lenders, has age limits for mortgages, especially for older borrowers.

If your mortgage application has been refused, you can always request from your chosen lender the reasons why your specific application was declined.

If you’re working with a trusted mortgage broker, you can request that your dedicated broker explores the reasons behind your application’s refusal and start to make steps to rectify any errors found on your application.

Why Did Barclays Decline My Mortgage After the Agreement in Principle?

What is key to understand here is that receiving an Agreement in Principle (AIP) from Barclays is a great start – but it doesn’t guarantee that your mortgage will be approved.

Put simply: an AIP is an agreement from the lender to an amount that they will likely be willing to lend you. This is always subject to their own full assessment and personal checks.

So, why might Barclays decline your mortgage after an agreement in principle?

A full assessment can uncover a variety of things, all of which could lead to a mortgage refusal after an AIP, including:

• Discrepancies in the documents you submitted
• Changes to your financial situation since your AIP, for example, you may have recently lost a job or have taken on unexpected debt.
• Errors could be found in a full credit check or property valuation

It is always recommended to keep everything up-to-date and to be transparent about your financial situation to avoid these surprises.

What Are the Next Steps After Barclays Rejects My Mortgage Application?

If you’ve been refused a mortgage by Barclays, there are steps you can take to get your mortgage journey back on track.

As we mentioned before, the key is to understand the reasons why Barclays declined your mortgage and to amend your application accordingly.

Here are the 3 steps you need to take if you’ve just had your mortgage application rejected:

1)   Don’t Reapply for a Mortgage Too Quickly

While it may be tempting to just jump straight back up onto the horse and try reapplying for a mortgage straight away, this could actually hurt your chances in the long run.

Submitting multiple applications in a short time can negatively affect your credit score, and if you’ve not addressed any of the problems then its likely that you’ll end up with another refused mortgage application with a worse credit score and history.

Take some time, read our most common reasons for mortgage rejections and reflect on the reasons behind your refusal. In addition, make sure that you use the time now to start improving your financial standing before reapplying.

2)   Find Out the Reasons Why Barclays Declined Your Application

As we previously mentioned, if you’ve been refused a mortgage by a high-street lender like Barclays, then you should have been provided with clear reasons for your mortgage refusal.

Make a list of reasons provided and actively work on strategies to amend any errors. Whether it’s improving your credit score or saving for a larger deposit, getting clarity on the issue is the first step to solving it.

3)   Reflect and Improve

Once you know why your mortgage was declined, it’s time to reflect and improve. Here are a few things you can do to boost your chances next time:

• Pay off or reduce any high levels of debt
• Save for a bigger deposit
• Fix any errors on your credit report

Improving your financial profile will not only improve the chances of success with your mortgage application with Barclays, but with all lenders.

Working with a trusted whole-of-market broker – like Boon Brokers – can help you secure the mortgage that best suits your financial situation. With whole-of-market access, we can help search and compare mortgage products from a variety of lenders to find the perfect mortgage for you.

Get In Touch with a Mortgage Broker

If you’ve received a mortgage refusal then you don’t need to feel stuck or confused – it’s time to talk to a professional.

A fee-free mortgage broker like Boon Brokers can guide you through the process, help you understand why your application was refused, and recommend the best next steps.

With access to a range of lenders, we can help you find the right mortgage product for you – even if you’ve been declined a mortgage before.

Here at Boon Brokers, we offer fee-free, expert and impartial advice.

Contact Boon Brokers today, our dedicated mortgage experts are waiting to help you.