7 Things That Can Keep You From Getting a Mortgage
by Allen Deaver, Asset Realty
When you're ready to buy a home—especially here in Central Texas—having your financing in order is one of the most crucial steps. Even buyers with good intentions and steady income can run into obstacles during the mortgage approval process. Understanding these common pitfalls can help you avoid surprises and keep your path to homeownership smooth.
Seven things that can keep you from getting a mortgage:
1. Low Credit Score
Lenders rely heavily on your credit score to determine your ability to repay a loan. A low score can lead to higher interest rates—or an outright denial. Late payments, collections, and high credit card balances can all drag your score down. A few months of cleanup can make a huge difference.
2. High Debt-to-Income Ratio (DTI)
Your DTI compares what you owe each month to what you earn. If too much of your income goes toward debt, lenders may decide you can't comfortably take on a mortgage. Paying down credit cards or consolidating debt can help you qualify.
3. Unstable Employment History
Lenders prefer steady, long-term employment. Frequent job changes, gaps in work history, or switching careers during the approval process can raise red flags. Even if an opportunity arises, it’s best to hold off until after closing.
4. Insufficient Down Payment or Savings
Even with low–down payment programs, lenders want to see that you have enough money not only for the purchase but for reserves. If your bank accounts are low or your funds can’t be properly sourced, it may delay or derail approval.
5. Making Major Purchases Before Closing
Buying a new car, furniture, or opening new credit accounts before your mortgage closes can significantly affect your credit and debt ratios. This is one of the most common mistakes buyers make—and it can stop the loan in its tracks.
6. Inaccurate or Missing Documentation
Lenders require detailed financial documentation: W-2s, tax returns, bank statements, pay stubs, and more. Missing documents or inconsistencies—like unverified income or unexplainable large deposits—can cause delays or an outright denial.
7. Issues With the Property Itself
Sometimes the home—not the buyer—causes the mortgage problem. If the appraisal comes in low, the home has major structural issues, or it doesn’t meet safety and lending guidelines, the lender may not approve the loan until repairs or adjustments are made.
Buying a home is one of the biggest financial decisions you'll make, and avoiding these pitfalls can help keep your mortgage approval on track.
Ready to Start Your Home Buying Journey
As a local, experienced Central Texas real estate professional, I’m here to guide you every step of the way—from preparation to closing. Call Allen Deaver with Asset Realty today, and let’s get you ready to buy your next home with confidence!
