Remortgage Expert

Mortgage Advisor

May 01, 2025

8 Common Reasons You Could Be Refused a Mortgage — And How to Fix Them

When applying for a mortgage or remortgage in the UK, even small oversights can cause your application to be declined. Whether you're a first-time buyer, moving home, or remortgaging to get a better deal, lenders look closely at your finances and documentation.

8 Surprising Factors That Could Prevent Mortgage Approval

1. 💷 Gifted Funds Without Proper Evidence

   Using a gift from a family member for your deposit? Lenders will ask for:

   • A gift letter confirming the money is a genuine gift, not a loan
   • Proof of the sender's identity and bank statements showing the transfer

   Fix: Make sure the funds are traceable and that you have documentation ready before submitting your application.

2. 💳 Unusual Bank Transactions

   Lenders go through your bank statements line by line. Red flags include:

   • Large unexplained deposits or withdrawals
   • Frequent gambling transactions
   • Irregular spending patterns

   Fix: Avoid suspicious transactions for at least 3 months before applying and be ready to explain any large movements of money.

3. 📉 Irregular Income or Freelance Work

   Self-employed or have multiple income streams? Lenders want to see consistency — not just how much you earn, but how reliably you earn it.

   Fix: Submit at least 2–3 years of accounts or SA302s and work with a broker who understands complex income structures.

4. 🏠 Incorrect Address on ID

   If your current address doesn’t match your driving licence, utility bills, or bank account, your application may get flagged.

   Fix: Update all key documents to match your current address before you apply.

5. 💼 Recent Job Change

   Just switched employers? Some lenders won’t accept applicants still in a probation period or without 3+ months in a new job.

   Fix: Wait until your probation ends or apply with a lender that accepts recent job changes. A broker can help match you with the right one.

6. 💳 Undisclosed Debts

   Leaving out personal loans, credit cards, or Buy Now Pay Later (BNPL) arrangements can result in a flat-out rejection.

   Fix: Disclose all financial commitments. Lenders will check your credit file anyway, so it's better to be upfront.

7. 📝 Incorrect or Incomplete Documentation

   Common documentation issues include:

   • Missing payslips
   • Unsigned bank statements
   • Outdated financial records

   Fix: Double-check your documents:

   • Are your payslips recent?
   • Are your bank statements full and unedited?
   • Are all documents dated and signed where needed?

8. 📉 Credit Report Errors

   From outdated addresses to incorrectly marked defaults, credit file mistakes are shockingly common — and damaging.

   Fix: Check your credit reports with Experian, Equifax, and TransUnion before applying. Dispute any inaccuracies and allow time for corrections.