Home Loan declined by a bank?

Having a home loan application turned down happens to thousands of people every year. But if it happens to you, don’t be discouraged - just because you've been turned down by the banks doesn’t always mean you can’t achieve your property ambitions or refinance your home loan.

We’ve helped thousands of borrowers in unique situations with our range of flexible home loans. Since we assess you as an individual, we look beyond your credit score to find out why payments were missed, or a default happened. 

Here are two considerations that could help move forward after being declined by a bank.

What's my bank's credit policy?

Major banks’ existing home loan processes

It’s possible that you may have your application for a loan rejected by a traditional lender because of their current credit policy. These policies can loosen or tighten based on market conditions and their risk management processes.

So whereas you may have had no issues getting a loan from a bank in better economic times, you could be rejected because of a tougher climate.

Another reason that an application may be turned down could be your credit history. Many major banks and traditional lenders use an automated credit scoring process, which means your application might be declined simply because a computer gives your application a score based on your credit history. Non-bank lenders typically offer a more bespoke service.


Could a non-bank view things differently?

Non-bank home loan processes

Non-bank lenders usually offer a different approach to home loan applications.

Where a bank may decline your mortgage application because you don’t tick all the boxes, many non-bank lenders consider your individual circumstances when assessing home loan applications.

For example, let’s say that you don't have up-to-date tax returns because you’re self-employed, which led to a bank rejecting your application because you don’t fit within their loan suitability and credit assessment criteria.

Whereas a non-bank lender, like us, would assess your application individually against our own loan suitability and credit assessment criteria. Each application is assessed on its individual merits, by a person, and not simply judged against an overarching credit score. 

So, in this example, it’s possible that your home loan application that had been rejected by a bank, would be approved with Pepper Money.


If you have defaults or judgements against your name, we can still consider your application and you may still be eligible for a Pepper Money Home Loan.

We’re more concerned with assessing why the defaults and judgements occurred, your current means of income, your ongoing ability to repay the loan without incurring financial hardship, where the property is located and the size of your deposit. We assess a range of factors so that we can determine your requirements and objectives for the finance. 

Turned down for a home loan? A non-bank could offer more flexible options.

We’re here to help

Many borrowers feel overwhelmed once they’ve been declined and then wait years until they pluck up the courage to apply again. But you don't need to wait for a bank to lend to you.

At Pepper Money, we believe everyone has the right to achieve their financial goals and we make it our mission to offer other avenues that traditional lenders may not offer. So contact us today on 0800 166 330 or enquire online - and see how we may be able to help when the major banks say ‘no’.


Apply for a Pepper Money Home Loan

Want to find out where you stand? Calculate your Borrowing Power.

Work out how much you may be able to borrow with us in just a few simple steps – and it won't impact your credit score.

You are protected by responsible lending laws. Because of these protections, the recommendations given to you about home loans are not regulated financial advice. This means that duties and requirements imposed on people who give financial advice do not apply to these recommendations. This includes a duty to comply with a code of conduct and a requirement to be licensed.

All loan applications are subject to the lender completing responsible lending checks and considering the borrower’s individual circumstances. Terms, conditions, fees and charges apply. Information provided is factual information only and is not intended to imply any recommendation about any financial product(s) or constitute tax advice. If you require financial or tax advice you should consult a licensed financial or tax adviser.

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