Mortgage Qualification Guidelines
- Mortgage Qualification Overview
- maximum debt-to-income ratio
- minimum credit score
- required down payment
- residence history
- borrower employment history
- lender underwriting guidelines
- Review the table below to understand how mortgage qualification guidelines apply to you
- Related FREEandCLEAR Resources
Most lenders use a similar set of mortgage qualification guidelines to evaluate your loan application. Qualification requirements can vary by lender type, mortgage program and loan amount but there are several key factors that typically apply to all borrowers:
Understanding how these guidelines apply to your personal and financial profile enables you to determine if you can qualify for a mortgage. It is also important to understand how mortgage qualification guidelines influence each other. For example, if you make a larger down payment, you may be able to qualify for a mortgage with a lower credit score. Or if your debt-to-income ratio is relatively low, your required down payment requirement may be lower.
Additionally, because lender may apply their own mortgage qualification guidelines, borrowers should always contact multiple lenders before selecting a loan. While you may not meet one lender's requirements, you may be able to qualify for a mortgage with a different lender.
Finally, different mortgage programs have different eligibility and qualification requirements. For example, you may not be able to qualify for a conventional loan with a low credit score but you may be able to qualify for an FHA loan. Or if your credit score is lower than 580 you may not be able to qualify for an FHA mortgage with a 3.5% down payment but you may be able to qualify if you make a 10% down payment. It is important to understand how mortgage qualification guidelines vary by loan program. Just because you cannot qualify for a standard conventional loan does not mean you cannot qualify for all mortgage programs. We encourage borrowers to contact several lenders to learn about the loan programs available to them.
There are multiple factors that determine a borrower’s ability to qualify for a mortgage and it is important to highlight that a borrower’s ability to qualify for a mortgage may be different than a borrower’s ability to afford a mortgage. For example, borrowers may be able to afford a monthly mortgage payment based on their income and debt but they may not qualify for the mortgage because they do not meet other qualification requirements such as the minimum credit score or employment history requirements.