My data point of how restrictive the financing criteria are

We were waiting for the market correction but then decided to purchase a home in VHCOL for some personal reasons. We were mentally prepared to lose a couple of hundred thousand dollars if the market corrects. That is the background.

The underwriting process and financial requirement were really ridiculous. Not sure if we are the exception or normal. If this is more normal than exception, I doubt people would default like 2008.

This entry level house is 1.4 million and we put down over 40%. The monthly payment is around $7500.

The underwriter determined we were on the boarder line of meeting their financing criteria.

Our combined base income is over 350k and take home pay is $15k a month after maximizing retirement. Excellent 830+ credit score. Additional very liquid saving to pay a few years mortgage. No other debt.

The underwriter did not take into account $2000 a month 1099 because it is deducted to 0, not considering $1500 rental properties income but add the 80k mortgage into the total debt (although we have additional saving to pay it off), and not considering my bonus ranging from 100k to 300k a year.

One of our job is very very stable and that alone can cover the monthly payment if we stop all the retirement contribution.

I really see almost 0 chance for us to default on this house. But the bank thinks we barely meet the their criteria.