Weekly Real Estate News
Summary
AD Mortgage surveyed more than 250 mortgage professionals in September 2026. Fifty-five percent cited income and debt-to-income qualification as a conventional loan closing obstacle. Respondents were divided on whether conventional business had grown or declined since 2023; the survey is not a national market forecast.
Mortgage professionals looking toward 2027 see a conventional lending market that remains essential to their business but is difficult to navigate for borrowers whose incomes do not fit standard underwriting.
In a survey published October 21 by AD Mortgage, 55% of more than 250 respondents selected income and debt-to-income qualification as a leading obstacle to closing a conventional loan. Credit and pricing ranked second at 40.5%, followed by cash to close or reserves at 27.3% and the monthly payment at 26.8%.
The survey ran September 1–30 and asked mortgage professionals about Fannie Mae- and Freddie Mac-eligible lending, including standard conforming and high-balance loans. Participants could select multiple answers to several questions. The percentages therefore should not be added together or read as shares of all mortgage denials.
A market with little agreement on direction
Exactly 30.5% of respondents said conventional loans had grown as a share of their business since 2023, while another 30.5% reported a decline. The remaining 39.1% saw little change. Looking ahead 12 to 24 months, 46.4% expected conventional’s share to remain roughly steady, 34.5% expected growth and 19.1% expected a decline.
The split is a reminder that lenders and brokers serve different borrower pools. A purchase-heavy operation with straightforward salaried borrowers can see a different pipeline from a shop specializing in self-employment, investment properties or complex documentation.
Standard conforming purchases were cited by 85% as a common transaction type. Cash-out refinances and investment-property purchases followed at 38.6% and 38.2%, respectively. First-time homebuyers were the most frequently selected borrower profile, at 40%.
Respondents were also divided over conventional lending’s long-term position. About 36.8% described it as the foundation of the mortgage market; 28.6% believed it was losing ground to non-qualified mortgages. Those are views from survey participants, not measured shifts in nationwide loan production.
Pricing helps; qualification still blocks closings
When asked why they choose conventional financing, 57.7% selected better pricing or total cost. Lower mortgage insurance or fees followed at 32.3%. Yet respondents gave conventional workflow automation an average score of 5.6 out of 10, below benchmarks cited from AD Mortgage’s separate surveys of non-QM and broader industry technology.
That comparison warrants caution because the benchmark groups were surveyed separately. It does not establish that conventional loans universally take longer or require more manual work than other products.
The lender has a commercial interest in how mortgage brokers view conventional and non-QM products. Its study provides a useful account of participating professionals’ experience, but the published summary does not establish a random, nationally representative sample. It should not be treated as a market-share forecast or a substitute for agency origination statistics.
The findings arrive as mortgage rates remain elevated and the housing market faces a wider affordability squeeze. WRE’s coverage of mortgage-rate lock-in documented why many existing homeowners are reluctant to move. For would-be buyers, the survey suggests the problem extends beyond finding a competitive rate: proving qualifying income and keeping debt ratios within acceptable limits remain central to getting a loan approved.
Source: AD Mortgage, Conventional Mortgage Trends: Heading Into 2027, published October 21, 2026. Featured image: Tom Rumble / Unsplash, illustrative neighborhood photograph.
