Mortgage basics
Mortgage refused: the 12 real reasons and the 15-day action plan
Mortgage refused: identify the true reason among the 12 most common, correct it with evidence and resubmit in the right order within fifteen days.
Following a mortgage refusal, the first step is to obtain written confirmation of who refused, whether the bank, the insurer or the guarantee body, and for what reason. An objective reason, once corrected and proven, can be resubmitted to the same institution; a reason based on an internal grid requires a different lender. Without a signed preliminary sale agreement, no legal deadline applies.
By Sandy MASCART, mandataire d'intermédiaire en opérations de banque et en services de paiement ORIAS 26000541 sous le mandat de CDV PATRIMOINE & ASSURANCE (ORIAS 14005573)
Key points
- A refusal comes from three distinct actors, the bank, the insurer or the guarantee body: identifying which one blocked the application is the first step before any follow-up.
- An agreement in principle obliges the bank to process the application, not to lend: only the issued loan offer constitutes a real commitment.
- Refusal reasons fall into four categories: repayment capacity, account management, income stability and the financed asset.
- Resubmitting to the same institution is appropriate for an objective reason that has been corrected and proven; changing institutions is appropriate for a reason based on an internal grid.
- Without a signed preliminary sale agreement, no legal deadline applies; with a preliminary sale agreement, it is the suspensive clause that sets the final date.
A loan refusal can often be rectified: identify the reason, correct it with supporting evidence, and resubmit to the appropriate institution. This is a key step in the home loan journey.
Have you signed the preliminary sale agreement? See loan refused after signing the preliminary sale agreement. Have you not yet submitted your application? Read the errors to correct before submission.
What exactly happens when a bank refuses a loan?
The bank, the insurer or the guarantee body has said no. Each has its own remedy: identify which one applies.
Bank, insurer or guarantee body: who said no?
- The bank assesses your capacity: the easiest refusal to correct.
- The insurer assesses a health or sporting risk: change insurer, supported by an AERAS agreement (the insurance refusal).
- The guarantee body assesses the transaction: quantify an alternative guarantee (guarantee, mortgage or IPPD).
If the refusal results from a file consultation, the lender must inform you of this, free of charge, and name the file in question.
An agreement in principle is not an agreement
It remains subject to the complete analysis. Only the issued offer is binding: the loan offer.
The 12 reasons for refusal, and the corrective action for each
Capacity, account management, income stability, financed asset: correct the signal sent to the analyst, not just the figure.
| Reason | What the bank infers | Corrective action | What determines the timeframe |
|---|---|---|---|
| 1. Debt-to-income ratio above the limit | The application falls outside the regulatory framework | Extend the term, settle a short-term loan, review the insurance proportion | Immediate if a loan can be settled; otherwise, a new financing plan |
| 2. Insufficient residual income | The household cannot withstand an unforeseen event | Change institution: the residual income grid is internal to each bank | The time required to resubmit, without modifying the application |
| 3. Excessive increase in payment | The monthly payment doubles or nearly so | Demonstrate that an equivalent monthly savings amount has already been accumulated | Three consecutive savings statements |
| 4. Overdrafts on recent statements | Tight cash flow, day-to-day management | Three months of clean accounts, without a single day of overdraft | Three complete monthly cycles, not one less |
| 5. Rejected direct debit or declared incident | Characterised payment incident | Regularise, obtain the certificate, explain in writing | The time required for the resolution and its proof |
| 6. Listing on FICP or FCC | De facto prohibition during the listing | Regularise the debt that caused the listing, have the removal confirmed | The specific timeframe of the removal procedure |
| 7. Ongoing consumer loans | Fixed burden and management signal | Settle what can be settled, provide the statement and proof of transfer | The time required to obtain the early repayment statement |
| 8. Probationary period or insufficient tenure | Income not consolidated | Wait for confirmation, or submit the application in the name of the other borrower | The end date of the probationary period |
| 9. Irregular or declining income | Non-sustainable calculation basis | Provide the complete fiscal year and a documented forecast | The accounting closure or the next set of accounts |
| 10. Insufficient down payment | Costs are not covered | Rebuild the down payment, mobilise employee savings, a formalised family loan | The timeframe for unlocking the relevant savings |
| 11. Unjustified source of down payment | Vigilance obligation not met | Provide complete traceability: deed of gift, deed of sale, statements | Immediate if the documents exist |
| 12. Property or structure rejected | Risk lies with the asset, not with you | Change the guarantee, review the structure, document the value of the property | The processing timeframe for the new guarantee |
Affordability: debt-to-income ratio, disposable income, payment shock
Critère d'octroi imposé aux banques. Le seuil est identique d'un établissement à l'autre ; l'assiette de calcul, non.
- En vigueur depuis le
- Source
- Décision D-HCSF-2021-7, art. 1er — Légifrance
The same limit everywhere, but a different basis for calculation: the HCSF rule. The disposable income follows an internal grid: refused here, accepted elsewhere.
Account management: overdrafts, incidents, ongoing loans
A single day of overdraft carries significant weight. Is it recorded? Regularise the situation and have the removal of the record confirmed. What the analyst looks for in your statements.
Professional stability and income
Is the end of your probationary period approaching? Wait. Are you self-employed? Banks do not retain the same income: the income retained by the bank.
Down payment and financed property
A down payment is proven by a document, not by a word. A refused property is corrected through the structure, the guarantee, or the price.
How much time do you have to find financing?
Without a preliminary sale agreement, no deadline is running. With one, the suspensive clause sets the final date.
Proceed quickly, but do not resubmit three days later to the same bank. Preliminary sale agreement signed: loan refused after preliminary sale agreement.
Should you resubmit to the same bank or change?
The same bank, if the reason is objective and corrected, with proof in hand. Another bank, if it relies on an internal grid.
Enveloppe collective mesurée en montant sur un trimestre civil. Elle n'ouvre aucun droit individuel à dérogation.
- En vigueur depuis le
- Source
- Décision D-HCSF-2021-7, art. 2 — Légifrance
A file slightly outside the standard framework may be considered in the following quarter. Why two banks respond differently · what the bank looks at, and in what order.
Reinstating a rejected application without weakening it
- The reason in writing. Without it, everything is speculation.
- Nothing new: no credit, no account, no cash facility.
- One point at a time, proven.
- Three months of clean account statements if account management is in question.
- A one-page note: rejected, corrected, proven.
- Banks chosen according to the reason, not according to the displayed rate.
An intermediary does not ask you for any advance:
When a rejection protects you
A debt-to-income ratio that only passes with the full term and all savings, a contested property value, an acrobatic structure: correct the project, not the file.
The first fifteen days, in order
- Days 1 to 2: the written reason, and who rejected it.
- Days 3 to 5: the evidence of correction.
- Days 5 to 8: the calculation redone; is it necessary to wait for a maturity date?
- Days 8 to 12: the note and the choice of banks.
- Days 12 to 15: a complete submission of the first attempt.
The documents · the purchase costs.
A named rejection can be corrected. Create your file, have the rejection diagnosed by telephone or write to me.
Sources
- Service-Public.fr — Que devient la vente lorsque le crédit immobilier est refusé ?
- Service-Public.fr — Fichier des incidents de remboursement des crédits aux particuliers (FICP)
- Service-Public.fr — Je veux obtenir un crédit immobilier
- Article L. 519-6 du code monétaire et financier — Légifrance
- AERAS, le site de la DG Trésor
Read next
- Mortgage in Lyon: frequently asked questions
- Listed on the FICP: removing your name from the register, then preparing your mortgage While listed on the FICP, a mortgage is refused almost everywhere. Check the entry, regularise the situation, have the removal confirmed, then reapply.
- First-time buyer mortgage application: the 7 errors that lead to rejection, and how to correct them in time Overdrafts, consumer credit, change of employer, untraceable gift, badly set sale agreement: what can be fixed before submission, and how fast.
- Mortgage insurance refused or surcharged: the AERAS agreement, appeals and solutions Refusal, exclusion or surcharge: the three levels of AERAS review, the capping mechanism, appeals, and the realistic alternatives when nothing works out.
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