The Seven Things a Mortgage Lender Actually Looks At

Mortgage decisions feel opaque because they are usually delivered as a yes or no without the middle part. The middle part is seven factors, evaluated together. Here they are, in the order most files are built.

1. Income stability

Not just how much — how reliable. Two years of steady W-2 work is the simple case. Bonuses, overtime, commission, and self-employment income typically need a two-year history to count fully. A new job in the same field with a signed offer letter? Usually fine. A brand-new career? Harder.

2. Debt load

Your monthly obligations against your income — the DTI story from our earlier post. Car payments and student loans do most of the damage here, not credit cards with small minimums.

3. Credit profile

Scores matter, but so do events. A bankruptcy, foreclosure, or short sale starts a clock — often two to four years depending on the program. What matters most is where you are on that timeline, and what you have done since.

4. Cash and savings

Down payment plus closing costs plus reserves (months of payments left over after closing). Gift funds are usually allowed with a letter explaining where the money came from. Large unexplained deposits get questioned — paper trails matter.

5. Payment fit

The estimated housing payment against your income. This is where a realistic price range comes from — not a maximum you should spend, but a number that fits the rest of your life.

6. The property itself

Condos in buildings with litigation or heavy investor concentration, manufactured homes built before 1976, homes on leased land, or properties in flood zones with special requirements — the property can be the reason a file struggles, no matter how strong your finances are.

7. Documentation

The quiet killer. Every fact above has to be provable. Pay stubs, W-2s, bank statements, letters of explanation. Files rarely fail on facts; they fail on paperwork.

Why this matters more than the yes/no

When a file comes back with a negative answer, it is almost never about all seven areas — it is usually one or two. The useful question is never "can I buy?" but "which of the seven is furthest behind, and what is the shortest path to move it?"

Our free check scores all seven pillars and shows you exactly that.

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