A mortgage is a long-term loan used to purchase real estate, where the property serves as collateral. To qualify, borrowers must meet lenders' criteria, including creditworthiness, stable income, and sufficient savings for a down payment. Lenders evaluate factors like credit scores, debt-to-income ratios, and employment history to determine eligibility and terms.

The ability to secure a mortgage depends on several financial and credit metrics. First, a minimum credit score of 620-680 is typically required for conventional loans, though scores below 580 may exclude eligibility entirely. Data from Fannie Mae (2023) shows that 60% of mortgage applications with scores below 620 are denied. Second, debt-to-income (DTI) ratios must be ≤43% for conforming loans, as per guidelines from the Urban Institute. Borrowers exceeding this threshold face higher interest rates or denial. Third, down payment requirements vary: conforming loans require 5-20%, while FHA loans need 3.5% (Federal Housing Administration, 2023). Only 35% of first-time buyers can afford a 20% down payment, per the National Association of Realtors (2022).

Mortgage approval rates have fluctuated due to economic conditions. During the COVID-19 pandemic, rates dropped to historic lows (3.1% for 30-year fixed loans in 2021, Federal Reserve), boosting affordability. However, rising inflation and interest rates in 2022-2023 increased denial rates by 15% (Consumer Financial Protection Bureau, 2023). Additionally, lenders tightened underwriting for self-employed applicants, with approval rates falling from 52% in 2020 to 38% in 2023 (U.S. Bank Mortgage Report). These trends highlight the importance of meeting lenders' evolving criteria to secure mortgage eligibility.