Blog > Mortgage Agreement in Principle Then Declined Barclays

January 19th, 2023

Mortgage Agreement in Principle Then Declined: Understanding Barclays` Decisions

If you’ve recently applied for a mortgage and received an agreement in principle from Barclays, only to later be declined, you might be feeling confused and frustrated. While it’s always disappointing to be turned down for a loan, it’s important to understand the reasons behind the decision.

In this article, we’ll explore why Barclays might decline a mortgage application despite providing an agreement in principle, as well as what steps you can take if you find yourself in this situation.

Why Might Barclays Decline a Mortgage Application After Providing an Agreement in Principle?

There are several reasons why Barclays might decline a mortgage application after providing an agreement in principle. Here are some of the most common:

1. Change in Circumstances

One of the most common reasons for a declined mortgage application is a change in circumstances. This could mean that your financial situation has changed since you received your agreement in principle. For example, you might have lost your job, taken on additional debt, or had a change in your credit score.

2. Property Valuation

Another reason why Barclays might decline a mortgage application is if the property you’re hoping to buy is valued lower than the amount you’re requesting to borrow. In this case, the bank might be concerned that you won’t be able to repay the loan.

3. Credit History

Your credit history is another factor that Barclays will consider when deciding whether to approve your mortgage application. If you have a history of missed payments, defaults, or CCJs (County Court Judgments), the bank might view you as a high-risk borrower and decline your application.

4. Affordability

Barclays will also assess whether you can afford to make your mortgage repayments over the long term. If the bank determines that you won’t be able to make your payments, they may decline your application.

What Should You Do if Your Mortgage Application is Declined?

If your mortgage application is declined after receiving an agreement in principle from Barclays, don’t panic. There are several steps you can take to improve your chances of being approved in the future:

1. Get a Copy of Your Credit Report

If your credit history is a factor in your declined mortgage application, it’s important to get a copy of your credit report so you can identify any issues and work to improve your score.

2. Review Your Finances

Take a close look at your finances to see if there are any areas where you can cut back on spending or increase your income. This will help you improve your affordability and make you a more attractive borrower.

3. Work with a Mortgage Broker

A mortgage broker can help you understand the reasons behind your declined application and guide you through the process of improving your chances of approval.

Conclusion

Receiving an agreement in principle from Barclays is a positive step towards securing a mortgage, but it doesn’t guarantee approval. If your mortgage application is declined, it’s important to understand the reasons behind the decision and take steps to improve your chances of approval in the future. By working with a mortgage broker and taking a closer look at your finances, you can increase your chances of securing the loan you need to purchase your dream home.