Not everyone qualifies for certain loans due to financial history, creditworthiness, income limitations, or specific program requirements. Borrowers with poor credit scores, insufficient income, prior defaults, or lack of collateral may be ineligible for conventional mortgages, student loans, business loans, or high-limit credit cards. Additionally, individuals without citizenship or permanent residency might be excluded from federal loan programs like FHA or VA mortgages.

Eligibility restrictions often stem from risk assessment by lenders and regulatory guidelines. For example, conventional mortgages typically require a credit score of at least 620, while FHA loans mandate a minimum score of 580. The Consumer Financial Protection Bureau (CFPB) reports that 60% of consumers with scores below 580 are denied mortgage approvals. Similarly, student loans from the U.S. Department of Education require citizenship or eligible noncitizenship, excluding many international students. The Federal Reserve’s 2023 survey found that 35% of applicants with income below $40,000 were rejected for conventional mortgages due to insufficient earnings. Auto lenders also exclude borrowers with scores below 620, as noted by Experian, which denied 45% of such applications in 2022. Business loans often require a proven revenue history, excluding startups without track records. These criteria ensure lenders mitigate defaults while complying with regulations like the Equal Credit Opportunity Act.