Homeowners who are not eligible to get a mortgage refinancing through the Governments “Making Home Affordable” plan will find that it is tougher to get than they thought. Mortgage refinancing requires a number of different income, debt, credit, employment, and other verifications. A mortgage lender or bank can deny a homeowner for any of these following reasons:

-The Homeowners Credit Score or Rating
Homeowners with a credit score which is too low, mortgage lenders or banks will most likely deny your application for mortgage refinancing. The best thing you can do if you are in this situation is try to explain your financial problems to your lender, and convince them that you have a plan to get your finances back on track, and save your home. If all else fails, you should look into a sub prime mortgage lender. These lenders are generally avoided unless all other options have been explored due to their high interest rates, and sometimes excessive closing costs.

-The Homeowners Income
Especially these days, mortgage lenders and banks will throughly be checking to verify all income. If a mortgage lender or bank has any questions or concerns about your income which you can not answer, you may be denied a mortgage refinance.

-Incomplete or Inaccurate Documentation
If you are unable to provide, accurately fill in, or completely fill out the paperwork needed for a mortgage refinancing, you will be quickly denied. This is probably the most common reason a homeowner with decent credit gets denied.

-The Homes Market Value at the time of Refinancing
Mortgage lenders and banks will most likely not approve a homeowner whose property values are dropping, or are dropping in the area. With the market in such bad shape, a lot of homeowners are in this situation. Generally, a mortgage lender or bank will never refinance a home for more than its market value.

-The Policies of the Mortgage Lender or Bank
Mortgage lenders and banks will have different policies from each other, sometimes they are drastically different. In general, homeowners must meet certain credit, income, ltv (loan to value), and equity requirements to get approved for a mortgage refinancing. Even then, a mortgage refinance may still be denied.

-M Petrone

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