When applying for a mortgage, it’s important for would-be homebuyers to be aware of the factors, both positive and negative, that could affect their ability to get a loan. Any steps you can take to accentuate the positive and resolve negative financial issues will be a plus in the eyes of the potential mortgage lender.

Positive Factors

Some factors that may help you get the mortgage loan you need include:

• A long and stable employment history, with zero to few lengthy periods of unemployment

• Low levels of debt, with no recent large purchases

• A debt-to-income ratio of 36% or lower

• A down payment of at least 5%-10% of the purchase price of the home

• Intention to buy a primary residence property, as opposed to an investment property

• A mortgage loan request for a single-family home, as opposed to a duplex, town house, or condominium

• Liquid assets on hand equal to two or more months of mortgage payments after all closing costs and expenses are factored in

Negative Factors

Some things that could harm your chances of getting the mortgage you need include:

• High levels of debt, especially high-interest credit card debt

• An unsteady employment history with long periods of unemployment

• A debt-to-income ratio of more than 36%

• If the buyer will have little or no cash available after closing costs

• If the buyer is unable to put down at least 5% of the cost of the home 

Consider these factors that mortgage companies will see as pros and cons when it comes to applying for a mortgage, and start making positive financial changes at least six months to one year before looking to get approved.