(If you work with a big bank or inexperienced loan officer)
You might have great credit and a fantastic FICO score… Guess what…
You could still have roadblocks when you work with a big bank or inexperienced loan officer. There are a ton of underwriting guidelines that must be met for typical conventional loans.
Below are 50 ways your loan can be denied:
- Trying to buy too much house
- Debt To Income ratio maximums exceeded
- Credit score too low
- Not enough Income
- Inability to document income
- Using rental income to qualify
- Past delinquencies
- Past foreclosure, short sale, BK
- Mortgage rates rise and push payments too high
- Payment shock
- Loan To Value too high
- Inability to obtain secondary financing
- Underwater on mortgage
- Not enough assets
- Unable to verify assets (mattress money is a No No)
- Unpaid alimony or proof of child support income received
- Divorce issues
- No rental history
- No job
- Job history too limited – (2 year history same line of work)
- Changed jobs recently
- Self-employment issues
- Using business funds to qualify
- Limited credit history
- Spouse’s/ Co Borrowers credit score too low
- Too much debt
- Undisclosed liabilities
- New or closed credit accounts
- New/changed bank account
- Credit errors
- Unpaid tax liens
- You Co-signed for other loans – effecting your DTI
- Property not really owner-occupied
- Layered risk (lots of questionable things added together)
- Incomplete application
- Inability to verify key information
- Fraud/lying
- Undisclosed relationships with seller
- Attempting to buy multiple properties
- Property doesn’t appraise at value
- Defects with property
- Home business on property (Some are OK)
- Non-permitted work to the home (garage conversions)
- HOA issues
- Investor concentration in complex too high
- One entity owns too many units in complex
- Title issues
- Lender overlays (Some Big Banks make up extra rules)
- You own multiple properties
- Good old fashioned mistakes (human error)
Now some GOOD NEWS… if you are rejected for a mortgage, it’s important to sit down with your loan officer and find out the reason behind that decision.
If you were honest on your loan application and have sufficient income and a half way decent credit score, sometime working with a more skilled loan officer is what it takes to get it done.
Working with a local Broker will give you more choices and more programs to fit the different credit profiles and income scenarios. When you work with a big bank, you get 1 set of rules. If you don’t fit their rules… too bad.
Choosing a local broker and loan officer with experience in purchase business, will give you access to many more options and programs.
Experience makes all the difference sometimes, to make credit/ income situations fit the hundreds of programs available.
There is also the possibility of a red flag or some unknown issue. Learning what that problem is, and having a skilled loan officer that knows how to fix it, is key.
If you have had a recent decline on your mortgage application and want a second chance or an experienced set of eyes to see what other alternatives you may have, please call 949-600-0944 or email me with your questions jackie@mylenderjackie.com or visit www.mylenderjackie.com
Right Choice Mortgage, located in Orange County and serving all of California – Has an extensive lender network, we find the best possible solutions and will do what it takes to get it closed.
Our borrowers get the best pricing, fastest turn times and specialized programs to meet their varied needs.
Products offered: Purchase and Refinance, FHA, Conventional, VA & Portfolio. We have programs to serve Jumbo Loans up to 3 Million and everything in between and down to 550 credit scores.
