"A quarter of all mortgage loan applicants get denied for loans, according to the Federal Reserve. Many other potential homebuyers never even try to get loans, said Jerry Howard, president of the National Association of Home Builders."
http://money.cnn.com/2011/04/19/real_estate/low_risk_mortgage_denied/index.htm
Key points from the article.....Why you could be denied a mortgage
Your debt is too high - If someone's total debt payments exceed 45% of income, the mortgage will be denied. In 2009, the limit was 55%.
The wait after foreclosure is extended to seven years from five-Despite high credit scores, ample assets and income and steady employment, lenders are not allowed to finance their Fannie/Freddie mortgages if their foreclosures happened any time within the past seven years.
Missed payments on credit card debt-They used to be okay with a missed payment or two. Now, one missed payment will hit your debt-to-income ratio, because banks will add 5% of your outstanding loan balance to the debt part of the calculation.
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