Having your mortgage application declined can be gutting — especially when you’re not sure why. The good news is that a “no” from one lender doesn’t always mean you can’t get a home loan at all. Often, it simply means your application didn’t match that bank’s policy or required more preparation.

As a mortgage broker in Tauranga, I see the same patterns crop up repeatedly. Here are three of the biggest reasons applications are turned down — and how you can avoid them next time.

1. Non-disclosure or missing financial details

One of the most common causes of rejection is leaving out information — intentionally or accidentally. Lenders want a clear picture of your assets, liabilities, income, and expenses before they’ll approve a loan.

Why it matters

If a bank later discovers something you didn’t disclose — like a “buy-now-pay-later” account or a personal loan — they can reduce or even withdraw your approval. Even non-financial details such as an upcoming maternity or parental-leave plan can change how your income is assessed.

How to avoid it

• Be upfront about every loan, credit card, or store account.
• Check accuracy: limits, interest rates, and balances should match your current statements.
• List all ongoing expenses — childcare, insurance, subscriptions, donations, and savings plans.
• Tell your broker early if major life changes are coming (job switch, baby on the way, hours change).

The more transparent you are, the more precisely your broker can match you to a lender whose policy fits your situation.

2. The wrong bank or income type

Each bank treats income differently. One might count only 80% of commissions; another might average two years of bonuses; a third could accept the full amount. Self-employed income is even trickier — some banks want two years of financials, others will take one-year results or a current forecast.

Why it matters

Your application might fail with one bank simply because their rules undervalue your income. Another lender could see the same numbers and approve it easily.

How to avoid it

• Ask how each lender calculates overtime, bonuses, or self-employed income.
• Work with a mortgage broker Tauranga who understands every bank’s criteria and can match you to the right one from the start.
• Keep your financial records consistent and up to date — no missing GST returns or late IRD filings.

Choosing the correct lender is often the difference between “declined” and “approved.”

3. The property itself

Sometimes the property — not the borrower — is the reason for rejection. Lenders prefer homes that can be easily sold if needed.

Properties that raise red flags

• Houses with high moisture readings or structural issues.
• Homes with unauthorised building work or missing council consents.
• Older dwellings that aren’t considered immediately liveable.

How to avoid it

Before applying, gather your due-diligence reports:

• Builder’s inspection report and moisture readings.
• LIM report and property file from council.
• Quotes for any required repairs.

Submitting these upfront builds confidence with the bank and speeds up assessment. It also helps you understand what the property will cost to bring up to standard.

What to do if you’ve already been declined

1. Ask for reasons in writing. Banks must outline the key factors behind their decision.
2. Check your credit report for errors or outdated information.
3. Review income documentation — small inconsistencies can trigger rejections.
4. Talk to a broker who can repackage your application for another lender without damaging your credit score.

Tauranga example

A self-employed client in Mount Maunganui was declined because their second business year showed reduced income after equipment purchases. We resubmitted the application to a lender that accepted one-year financials and added back non-cash expenses. Result: full approval within five days. Same client, same numbers — just the right policy match.

Key takeaway

A mortgage rejection doesn’t mean the end of your home-buying plans — it just means there’s a better-suited lender or a cleaner way to present your finances. With the right preparation and guidance, approval is still within reach.

Book a quick chat today to review your situation and find out how we can turn that “no” into a “yes.”