5 surprising reasons your mortgage might get denied that you didn't know about - beware no. 3

A mortgage that gets denied is a serious blow to any potential homeowner; avoid being caught out by these less expected reasons for being rejected for a home loan

A house in the US
(Image credit: Unsplash/Aubrey Odom)

If you're thinking of applying for a mortgage, you likely already know about the importance of building up good credit, saving up enough for a down payment, and not taking on too much debt. But did you know that there are other, more unusual reasons why you may denied a mortgage? These are the pitfalls people often don't consider when applying, according to mortgage experts. 

1. Your bank statements are showing betting or gambling transcactions

Online gambling can be fun for some people, but if your bank statements are showing gambling transactions, you could have your mortgage application denied. Of course, context is everything. 

'If you’re betting small amounts here and there (such as playing the lottery), then it won’t have an impact on your mortgage application', says James Andrews, mortgage expert from Money

However, if you're betting or gambling regularly, or if you're borrowing money to gamble, you can expect your application to get rejected. Simply put, lender don't like financially risky behavior, and gambling is one. 

2. You've recently moved jobs – even if your new one is better paid

House in North Carolina

(Image credit: Brittney In Beta on Unsplash)

This seems to make no sense – you are now in a better, more lucrative job that should surely make you more not less qualified for a mortgage? Unfortunately, even a move up the career ladder can hurt your mortgage application. 

According to Experian: 'Mortgage lenders want to see stability; recent job changes may raise doubts about your ability to hold a steady job. Having the same job for at least two years may help your chances of approval.'

3. You've recently sent someone money as a gift – or received one

Sending someone a large sum of money as a gift may feel different from splurging on something for yourself, but lenders actually see it the same way – as extravagant spending. Even sending $100 for someone's birthday may raise questions if that is outside of your normal spending. 

Likewise, if you receive a cash gift from family or friends, don't just deposit it into your bank account without telling your lender first. Blair Warner, senior credit consultant and founder of Upgrade My Credit, told amerifirst that 'to be safe, anything over $200 that is not a part of your normal monthly income should be mentioned to your loan officer.'

4. Accidentally omitting information 

A US house with a porch

(Image credit: Birgit Loit on Unsplash)

There is a big difference between omitting and failing to disclose, but they both can lead to mortgage rejection. Property experts from Homelight confirm: 'If you decide not to share something (or a piece of information gets left out by accident), it can put you back at square one with your mortgage loan.' 

It can be something as simple as accidentally missing a zero when putting in your income – but it could raise big questions with your loan officer. 

5. Accidentally saying you have more kids than you do

US house with pool

(Image credit: Getty/Lee Ergulec)

Sounds improbable, but it does happen. 'Looking after children is expensive, so lenders consider this, as well as how much you earn when they calculate if you can afford a mortgage,' says James Andrews

Of course, this type of mistake usually happens by accident, but be aware that this can have serious implications. 'Something as simple as your browser automatically completing the section on dependents could lead to it looking like you have several children, therefore your income would need to be extremely high to have your mortgage agreed.' 

Anna Cottrell
Anna Cottrell

In 2018 Anna moved into the world of interiors from academic research in the field of literature and photography. She is the author of London Writing of the 1930s and has a special interest in city life, decorating small spaces, and urban gardening.  

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