Condensed List of Reasons Why Mortgages Get Denied
- Loan amount to large for county loan limits
- Income too low
- Inability to document income/ Inability to document income
- Using rental income to qualify
- DTI ratio exceeded
- Mortgage rates rise and push payments too high
- Payment shock (current rent vs new mortgage payment)
- LTV too high
- Inability to obtain secondary financing
- Underwater on mortgage
- Not enough assets (2-3 months for conventional/ Zero for FHA)
- Unable to verify assets
- Buyer has misrepresented material facts
- Job history limited/ Inconsistent/ Changed Jobs Recently
- Collection Accounts
- Self-employment issues
- Using business funds to qualify
- Limited credit history
- Credit score too low
- Spouse’s credit score too low
- Past delinquencies
- Past foreclosure, short sale, BK
- Too much debt
- Undisclosed liabilities
- New or closed credit accounts
- New/changed bank account
- Credit errors
- Buyer's unpaid tax liens/ unpaid child support
- Unpaid alimony/other divorce issues
- Seller's unpaid taxes/ or lawsuits
- No rental history
- Fraud/lying
- Undisclosed relationships with seller (non arms-length transaction)
- Attempting to buy multiple properties (at the same time)
- Defects with property / non permitted work
- Giver of Gift $$ can't or won't provide proof of funds
- Poor communication between Escrow-RE agent-and Loan Officer
- HOA Issues
- Investor concentration in complex too high (more than 50%)
- One entity owns too many units in complex (10% or more)
- Lack of loan officer experience
- Lender overlays (in addition to FHA / Coventional Basic Guidelines)
- Buyer has too many properties with mortgages (10 is Max)
- Co-signer for other loans
- Property not really owner-occupied
- Layered risk (lots of questionable things added up)
- Incomplete application / Incomplete information
- Inability to verify key information
- Plain old mistakes
Call me if you have any questions 909-452-2891
