10 things that can kill a home loan At the peak of the real-estate bubble, mortgage professionals joked that you needed only to be able to fog a mirror to get a loan. These days, even borrowers with good incomes and good credit scores can get turned down. Much of the change is driven by the higher standards of the companies that buy mortgage loans, including Fannie Mae, Freddie Mac and various large banks. Here's what you need to look out for if you're trying to land a mortgage, whether you're buying a home or refinancing: 1. The house needs too much work. A lot of properties on the market these days are foreclosures owned by banks, and many aren't in great repair. If a house is in really bad shape, it can be tough, if not impossible, to persuade another lender to give you the money to purchase it. Broken windows, defective appliances, roof leaks and serious water damage can all cause a lender to require repairs to the damaged areas. Bottom line:If it's a real fixer-upper, you may need to pay cash. 2. The appraisal came up short. Occasionally during the bubble an appraiser would decide a home was worth less than the price a buyer and seller had agreed upon. But that was relatively rare. These days, the situation is drastically different. New rules hold appraisers to higher standards and sharply limit communication between appraisers and lenders. So the appraisal on the home you want to buy may fall short of the agreed-upon selling price. Even if the first appraisal goes well, a second evaluation -- known as the review appraisal and now ordered by all VA investors that buy home loans -- may not. Bottom line:You may be able to nudge an appraisal a bit by showing there are better "comparable sales" available than the ones the appraiser used. In general, though, appraisers are much harder to influence. You may need to reopen negotiations with the seller or come up with a down payment to make a deal work -- or pay down your mortgage in order to refinance. 3. You have too much debt.Lenders look at how much of your income will go toward housing expenses (mortgage, property taxes and insurance) as well as how much you spend on other debt payments.