Can a DUI Affect Your Chances Of Getting a Mortgage?

There are several factors that determine the chances of getting your mortgage application approved. Elements like your credit score, income, liabilities, and credit history all lend insight into an applicant’s financial habits. However, one thing that a lot of people are unaware of is that lenders look into other things that seem like they aren’t related to buying a house.

While lenders do not conduct criminal background checks, they can look into whether you’ve gotten a conviction for driving under the influence (DUI). While your mortgage application isn’t going to be denied over a DUI conviction, this can indirectly and adversely affect your application. Let’s find out how:

How Is a DUI Conviction Relevant to a Mortgage Application?

A DUI conviction has many implications that are likely to affect your capacity to repay your mortgage. Not only will a convict incur a criminal record (which will affect that applicant’s chances of landing a job), but a convict may also have to serve time in jail and will also have to pay fines. In many cases, convicts also have to pay damages, some of which can be substantial and long-term.

Serving Jail Time

An applicant will need to explain the time he or she was unemployed while serving jail time. Depending on the length of the time served, the long gap in unemployment may disqualify an applicant (one requirement is that applicant must have been employed for a certain number of years). The logic behind this is that lenders need to see that an applicant has a stable source of income.

Jail Time Affects Other Debt

For obvious reasons, a person sent to jail cannot work. This means any debts that person had during the serving of the sentence are likely to be left unpaid. This means that the individual may have a low credit score, as well as a history of late payments, and other negative implications on credit history. This then makes the application a high-risk investment for mortgage providers, which may decrease the chances of securing a loan or a fairer loan term.

Court Fines and Damages May Weigh Heavily On an Applicant’s Ability to Pay

DUI damages are not minor expenses by any stretch. Court fines for a first offense will range from $20,000 and above. Couple this with the possibility that a claimant will likely also sue for damages, and you’ve got at least $20,000 worth of obligations. Furthermore, this can easily compound the other financial obligations you need to address, which is why a DUI lawsuit should never be taken lightly. This is also a reason why you absolutely need a DUI attorney to help you with a case, whether you’re a claimant or defendant. A criminal charge can have life-altering effects.

While a DUI conviction may not directly affect your mortgage application, it will significantly and adversely affect your chances of securing your application. With this in mind, it’s important to stay on the good side of the law. Things that seem unrelated are bound to affect other aspects of your life, and this is evident in this case.

Check out our featured listings