What disqualifies you from refinancing?

There are a number of factors that can make it hard or impossible to refinance your mortgage:

• A low credit score: Most lenders want at least the mid-600s (higher for best rates).
• Not enough home equity: Usually, you need at least 3–20% equity in the home securing your loan.
• High debt-to-income ratio:  Too much debt compared to your income.
• Unstable income or employment: Lenders look for consistent, verifiable earnings.
• “Underwater” loans: If your property is worth less than you owe, refinancing becomes difficult.
• Recent late mortgage payments: Your payment history is closely reviewed during underwriting.

Even if one or more of these apply, you may still qualify with certain programs, but the terms you are offered may be less favorable.