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Why it will be more difficult to qualify for Mortgage after 2014.

Dodd Frank Act requires to Prove income, Employment, Debt and other obligations like Child Support or Alimony.

After the housing crash of 2010 brought about by the bad practices of the Mortgage lenders lending enormous amounts of money to unqualified homeowners, new laws were passed to prevent the same thing happening.

This new law is called the Dodd Frank Act which will make it harder for lenders to lend money when it comes into effect in 2014. This is aimed at avoiding to lend money to people who will not be able to pay. It has put some standardized measures to ensure they are followed by all lenders.

There are many things that mortgage lender will be required to check before giving a mortgage to an applicant. These are:

Enough Income and Assets to afford Mortgage

The lenders will be required to verify that the borrower has enough income to be able to make the monthly mortgage payments. This will include the mortgage principle, interest, taxes and home owners insurance costs.

Prove Employment of self employment

One way to verify income is to prove employment. A borrower will have to furnish their employment and earning information for about 2 years so that the lender can see they have a stable income.

For those who are self employed, you have to show that you have been in the same business for at least two years and also show your tax returns to verify income.

Other payment obligations

If you have other properties that you are paying mortgage for, then you will need to show what other bills and liabilities you are paying for and that you have enough income to pay for them.

So you will need to give a full disclosure of all the properties you own.

Child Support and Alimony

If you pay monthly child support of alimony payments, these will need to be factored in to see if you can pay the mortgage after paying these obligations.

Good Credit history

You will also need to have a good credit history so that you can get a mortgage with lower interest rates. The lower interest rates you get the better because it will reduce your mortgage costs and monthly payments.


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