Perhaps 2000 will be the year you buy your first house.

It's an exciting prospect, but it also requires a lot of saving and planning. Do your homework ahead of time to avoid a major disappointment -- getting turned down by the mortgage company.The Mortgage Bankers Association has put together a list of the most common reasons that mortgage applications are rejected. The list was reprinted in GMAC Mortgage's industry newsletter, Market Commentary.

First on the list: the appraised value of the house is too low. Say you agree to buy a house priced at $120,000 and apply for a mortgage of $108,000. The lender hires an appraiser to look over the property and the appraiser comes back with his report -- $110,000. That means you're getting a loan for all but $2,000 of the appraised value of the house. The lender won't take that risk.

In this case, you can try negotiating with the seller to get a lower sales price. If that doesn't work, you can accept a smaller mortgage and increase your down payment, assuming you have enough cash and still want the house.

Another common problem is that the lender looks over your financial documents and determines you don't have enough cash to cover the required down payment closing costs. Unless you have a fairy godmother or other good soul who will give you the money, you're out of luck in this case. But at least you learn from the process just how much money is needed at closing.

A worse problem is having insufficient income to cover the mortgage payments. As a general rule, lenders want your mortgage payment to take up no more than 28 percent of your gross monthly income. Total debt, including the mortgage, should come to no more than 36 percent.

"However, if your credit record is very good, and you can show that you've already successfully carried an equivalent housing expense, either through rent or in your current mortgage, you may be able to convince the lender that you're the exception to the rule," MBA says.

Having a lot of debt is almost sure to cause problems when you apply for a mortgage. Lenders look not only at the total debt but also whether you have many credit cards and are increasing balances on them. "The only solution is to pay off the debts, bring the outstanding balances down and reduce the number of creditors who are owed money."

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If you have a history of missed payments and past due accounts, "the chances of your mortgage application being turned down go way up." The only way to solve this problem is to establish a record of clean, on-time payments for at least a year.

There are lenders who will give you a mortgage despite a record of bad credit payments. But the interest rate will be sky high.

The Mortgage Bankers Association advises anyone who is turned down for a mortgage to find out why. That way, you can move to fix the problems and re-apply when you're back on your financial feet. But it's best to make sure you know what's needed before you even bid on a house.

Pamela Reeves writes this column weekly for Scripps Howard News Service.

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