Can a personal loan affect getting a mortgage?

Mortgage underwriters apply strict DTI limits, typically 43% for qualified mortgages and 50% for FHA. A new personal loan with a $400/month payment can push borderline applicants past the threshold and trigger decline or rate adjustment.

The hard inquiry from a personal loan also affects FICO mortgage scoring models, though by less than people fear (3-7 points, fading within 12 months). The new account lowers your average account age slightly, which is a small additional drag.

If you're within 6-12 months of a planned mortgage application, avoid taking new personal loans unless absolutely necessary. If you must, time it so the personal loan account ages at least 6 months before the mortgage application.