Reasons for Mortgage Loan Rejection

There are many different reasons why a potential borrower could be turned down for a mortgage loan. But it usually comes down to one of four things. Here are the four most common reasons people have their loan applications rejected by lenders:

• The borrower's credit score is too low.
• The borrower has too much debt.
• They borrower is asking for too much money, relative to income.
• The borrower lacks a down payment.

Some of these things tend to overlap. For example, having too much debt relative to your income (item #2) can actually lower your credit score (item #1).