Call it a cultural thing.
That was one reason cited by loan originator JoAnna Camposano for why Texas was the toughest state in which to close a mortgage in 2022.
The Lone Star State ranked No. 1 based on an analysis of 2022 Housing Mortgage Disclosure Act (HMDA) data conducted on behalf of Lone Star LO magazine by Richey May, a Denver-based financial services firm.
The analysis, which included reviewing first- and second-lien loans, determined that Texas ranked as the toughest place to close a loan, with just 46.33% of mortgage applications being funded. Louisiana ranked second, at 46.75% of applications funded, followed by Florida at 46.98%, Mississippi at 47.75%, and Georgia at 48.13%.
That compares to a rate of 52.8% of loans funded nationwide. The analysis included data from the 50 U.S. states and the District of Columbia along with combined data for the U.S. territories of Guam, Puerto Rico, and the Virgin Islands.
According to the analysis, 21 of the 52 states and territories funded loans at rates below the U.S. average.
It’s no coincidence that the top five toughest places in which to close a loan were all located in the South. That was by far the toughest of the four U.S. regions to close a mortgage in, with just 49.38% of loans funded. The three other regions — the Midwest (57.62%), Northeast (55.44%), and West (53.41%) — all had funded-loan rates above the U.S. average.
Based on HMDA data, there were six reasons for a mortgage to not be funded:
• The application was denied;
• The application was approved but not accepted by the borrower;
• The pre-approval request was denied;
• The pre-approval request was approved but not accepted;
• The file was closed for incompleteness; or
• The application was withdrawn.