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7 Ways to Improve Your Chances of Getting Your Home Loan Approved

A home is one of the important necessities of every individual, but the privilege of owning one is something that is easier said than done. Unless you’re very rich or very lucky, owning a home will involve getting a home loan.

Here in the Philippines, banks and lending institutions implement a conservative approach. They will put your credit, finances and employment history under a microscope when deciding whether to give you the loan. They really mean business don’t they? But don’t fret, all is not lost.

Here are 7 ways of getting that extra leverage to obtain that home loan:

  1. A stable source of income

Banks and lenders see income stability as a very important factor because it shows your ability to pay. If you’re steadily employed (at least two years), they’re more likely to approve your loan. So it is a good idea to keep your job but if there is a need to change jobs, it helps if you continue working in the same industry.

  1. Avoid changing banks

Doing business with the same bank for a period of time is another sign of stability. Plus they will have more faith in you as a valuable asset.

  1. Disclose all information

It is crucial that you disclose all relevant information when you apply for a home loan. Banks and lenders check everything which has relevance. It’s also wise to be upfront about any other issues to help the application proceed more smoothly.

  1. Save up

Saving up to make a large down payment shows banks and lenders that you know how to save. A large down payment reduces the loan-to-value ratio, which increases your chances of getting your loan approved.

  1. Have a guarantor

A guarantor serves as a contingency plan because it reduces the risk of nonpayment. The guarantor is someone who is liable to pay for the loan if the borrower cannot. The guarantor is compelled by the bank to pay the debt even if he/she did not receive any benefit from the loan which of course if agreed upon by him/her whilst signing the Guarantee Agreement.

Tip: Be nice to your parents. They can help by giving you some cash to put down.

  1. Pay your debts

It’s best to get into the habit of repaying credit cards, store cards, catalogue accounts and overdrafts. It will help you save and also increase your chances of getting a mortgage.

Tip: Having no debt isn’t necessarily a good thing. You really need a credit history so that lenders can see that you’re good with debt and on time payment.

  1. Check your credit report

Better check your credit history when you apply for a home loan so you can correct any errors. Furthermore, you’ll have a good explanation ready for any discrepancies that may pop up.

Owning your own home entails a lot of responsibility and commitment. By accomplishing all the paperwork and making yourself financially presentable, the greater your chance of success in obtaining a home loan.


Looking for a home? Contact us now and we’ll help you find the perfect spot.

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