3.4 million turned down for mortgage

As many as 3.4 million UK borrowers have been turned down at least once for a mortgage or loan in the past 18 months, GE Money Home Lending research reveals.

Following a recent trend of lenders tightening their criteria, GE's research suggests previously creditworthy people are now potentially being classed as a "higher credit risk" and therefore finding it more difficult to source a deal.

Furthermore, more than 458,000 potential mortgage and loan customers had to apply at least four times before successfully securing credit during the last 18 months.

"Multiple failed applications can be time consuming and, of course, can be detrimental to a borrower," explained Gerry Bell, head of mortgage marketing, GE Money Home Lending.

"With criteria changing regularly and the risk of decline increasing all the time, it is even more important that borrowers looking to obtain a mortgage use reputable mortgage professionals with broad experience, knowledge and systems at their disposal which will increase the chances of the borrower getting the deal they need," he added.

Crucially, the research also reveals how potential borrowers reacted to rejection.

Some 13 per cent went on to make four or more applications before being accepted for the loan they needed, while around 30,000 people made more than eight applications.

Around 30 per cent of rejected borrowers – including those turned down for first mortgages, remortgages, unsecured loans and secured loans - gave up once they were rejected, while 12 per cent - around 412,000– were not accepted by any lender despite trying again.

"The focus in the mortgage market is now on availability more than anything else, with financially strong and experienced lenders the most likely to offer credit," added Mr Bell.

"In addition there are a number of dedicated specialist lenders with strong pedigree who may be able to help meet borrowers' needs."