3 Reasons Your Mortgage Loan Application Might Get Denied

3 Reasons Your Mortgage Loan Application Might Get Denied

Buying a house is definitely an achievement that everyone hopes to attain, but if you’re going to wait until you can afford the full price, then you might get a house much later in life. This is why mortgage loans exist. If you find a good mortgage loan, you could get the house you want now and pay in installments later. 

But not all mortgage loans get accepted. For some, getting one is more difficult than it seems. To help you avoid and prevent this, here are the top reasons why creditors may not want to grant you the loan:

3 Ways Your Mortgage Loan Can Get Denied

1. You Have Unpaid Credit Elsewhere

Your credit report has everything creditors need to determine your qualifications for a loan. If you have an enormous amount of unpaid debt elsewhere, they won’t risk granting you a mortgage. Your chances are even lower if you haven’t been filing taxes properly. Missed payments for child support can also be a reason for denial. 

Having outstanding debts may make it difficult to make payments on another loan. Creditors would rather loan the money to those with a good credit score—financially responsible individuals. Until you settle the payments, mortgage loans are out of the picture.

2. There Are Gaps in Your Employment

Job hopping is not a good sign of a squeaky clean record. People who bounce quickly from one job to another can indicate instability. It could suggest that they are incapable of holding down a stable paycheck. It can also show signs of inconsistency and an inability to take things seriously.

But suppose there is a valid reason for the big gap, such as starting a family, going on vacation, or fulfilling other commitments that aren’t related to a job. In that case, there’s still a chance that you can get that loan as long as you intend to stay employed in your current job. Stability is what banks are looking for, and this means consistency in every way possible. 

3. Insufficient Funds

This might be ironic since loans are meant to be granted to those who don’t have the money now. But to get a loan, you need to have some money. 

The reason creditors won’t lend money to people with insufficient funds is that it is an indication that you won’t pay your debt once you have it. Their business relies on your ability to pay them back. If you don’t have a stable income and there are instances that your bank goes zero, you’re not financially capable enough to handle the responsibility of paying a mortgage.


Applying for a loan may seem simple enough, but the reality is that there’s always a possibility you might be denied. Before you go looking for a good mortgage loan, you need to assess your current financial situation. Loans are meant to be paid off gradually, so if that’s a financial responsibility you’re not ready to take on, consider straightening things out before pushing through.

Are you having trouble getting a good loan for your home? Call Frontline Financial, the best mortgage broker in Salt Lake City. We are dedicated to helping Veterans get good loans for their dream homes. We believe that every Vet deserves the comforts of their own home. Contact us now to get the ideal mortgage loan for you today!