How often do people get denied a mortgage?
According to the mortgage data firm HSH.com, about 8% of mortgage applications are denied, though denial rates vary by location and loan type. For example, FHA loans have different requirements that may make getting the loan easier than other loan types.
One in six (16%) mortgage holders have overcome being rejected for a mortgage in the past, highlighting that getting a home loan is not something to be complacent about. Research found that over half (54%) of homeowners who were rejected took longer than three months to be accepted for another mortgage.
According to loan-level mortgage data from the Home Mortgage Disclosure Act (HMDA), 86.3% of 2020 applicants were approved for home purchase mortgages, with a median loan amount of $235,000. In the second half of 2020, 30-year fixed mortgage rates fell below 3% for the first time in history and then continued to fall.
After a housing market boom and bust, mortgage lenders have become more strict in their lending standards and requirements. It is not impossible to get a loan, but it is much harder for potential buyers to obtain one than before.
The average rejection rate for mortgage refinance applications increased to a decade-plus high of 25.6% this year, a jump from 15.5% last year. Meanwhile, rejections for overall mortgage applications rose to 22.6% in Oct., up from 13% in Oct. 2023 and 17.4% in Oct. 2022.
Federal Housing Administration loans: 14.4% denial rate. Jumbo loans: 17.8% denial rate. Conventional conforming loans: 7.6% denial rate. Refinance loans: 24.7% denial rate.
Can My Security Deposit Be Returned If My Mortgage Is Denied At Closing? If you have a contingency in place that includes an offer and purchase contract, you may be able to get your earnest money back. However, if you don't have it, you could lose it.
The Bottom Line. On a $70,000 salary using a 50% DTI, you could potentially afford a house worth between $200,000 to $250,000, depending on your specific financial situation.
If you can make a large down payment, you may be able to afford a $325,000 house on a $60,000 salary. Otherwise, it could be a challenge to qualify for a loan or keep up with your monthly payments.
But if you do get a mortgage, Dave Ramsey recommends following the 25% rule—remember, that means never buying a house with a monthly payment that's more than 25% of your monthly take-home pay on a 15-year fixed-rate conventional mortgage.
At what age is it harder to get a mortgage?
As Federal Reserve economist Natee Amornsiripanitch noted in a recent brief, older mortgage applicants are “significantly” more likely to be rejected for a loan than similarly situated, but younger, borrowers. At the same time, loan rates increase steadily with age, peaking for new borrowers over the age of 60 and 70.
Can I buy a house with low income? Yes. There is not a specific minimum income to qualify for a mortgage and there are various loan types and programs designed to help eligible buyers cover a down payment or even closing costs.

The Quick Answer. A $100,000 salary positions you within striking distance of homes priced between $225,000 and $300,000, but remember, it's not a one-size-fits-all answer. Your unique financial picture, creditworthiness, and the ever-changing housing market all play a role in pinpointing your precise affordability.
In its annual Profile of Home Buyers and Sellers, the industry group found that 4% of successful home buyers had a mortgage application rejected by a lender before they went on to secure a mortgage.
- Check Your Credit Report.
- Fix Any Mistakes.
- Improve Your Credit Score.
- Lower Your Debt-to-Income Ratio.
- Go Large with Your Down Payment.
Some lenders offer a mortgage rate float-down option, which allows you to lower your rate during the lock period if market rates fall. Floating down your mortgage rate comes at an added cost, so you'll have to consider your financial situation and larger market conditions when deciding if this option is right for you.
High debt-to-income (DTI)
Before approving you for a mortgage, lenders review your monthly income in relation to your monthly debt, or your debt-to-income (DTI). A good rule of thumb: your mortgage payment should not be more than 28% of your monthly gross income. Similarly, your DTI should not be more than 36%.
There's no reason for a borrower to worry or stress during the underwriting process if they get prequalified. They should keep in contact with their lender and try not to make any major changes that could have a negative impact on this critical process.
- Your Credit History. ...
- Your Income and Savings. ...
- Your Debt-to-Income Ratio. ...
- Your Down Payment. ...
- Your Loan Type.
If your financial situation changes or your credit score takes a hit before closing day, the lender could deny your mortgage. Making major purchases, applying for new credit or changing jobs are common mistakes that could put your mortgage approval at risk.
Do mortgages look at your bank account?
During the mortgage loan application process, lenders will usually want to see 2 to 3 months' worth of checking and savings account statements. They will review these statements to confirm your income and expense history and ensure you'll be able to make your mortgage payments.
Denial of a Loan
If a purchase agreement includes a loan financing contingency, and a buyer is denied a loan, they can back out of the transaction and get their earnest money deposit refunded.
An individual earning $60,000 a year may buy a home worth ranging from $180,000 to over $300,000. That's because your wage isn't the only factor that affects your house purchase budget. Your credit score, existing debts, mortgage rates, and a variety of other considerations must all be taken into account.
As of Jan 1, 2025, the average hourly pay for a $70000 in California is $22.15 an hour. While ZipRecruiter is seeing salaries as high as $35.35 and as low as $15.42, the majority of $70000 salaries currently range between $18.99 (25th percentile) to $22.79 (75th percentile) in California.
According to the 28/36 rule, you should spend no more than 28% of your gross monthly income on housing and no more than 36% on all debts. Housing costs can include: Your monthly mortgage payment. Homeowners Insurance. Private mortgage insurance.