You find the perfect deal. The numbers work. The cash flow screams your name. You send the paperwork to your lender. You start picking out paint colors.
Then, BAM.
The lender kills your deal.
I’ve seen investors lose massive opportunities over completely avoidable mistakes. They hit a roadblock, panic, and walk away. Don’t do that. When you know exactly what kills a real estate deal, you know exactly how to save it.
Let’s break down the five biggest deal killers in real estate financing and exactly how you beat them.
1. The Low Appraisal (And How to Fight Back)
You agree to buy a property for $500,000. The appraiser walks through, checks a few boxes, and tells the bank it is only worth $450,000. The bank refuses to fund the difference.
Panic sets in. But you have options.
First, fight back. Grab recent, comparable sales (comps) from your real estate agent. Show the appraiser exactly why their number is wrong. If your comps are solid, appraisers adjust their valuation.
If the appraiser refuses to budge, order a second appraisal.
Here is where having a mortgage broker saves your skin. Some big banks refuse to accept a second appraisal. You are stuck. A broker simply takes your file, walks away from that bank, and hands it to a different lender who will order a fresh appraisal.
Do this: Build a strong case with comps before you dispute. Don’t do this: Accept a bad appraisal as the final word.
2. Hidden Debts (Stop Lying to Your Broker)
Listen to me closely. Do not hide your debts from your mortgage broker.
I’ve seen investors “forget” about a car loan or a massive credit card balance. They think the lender won’t find out. The lender always finds out. We pull your Equifax report. The lawyer runs a background search. The truth comes out right before closing, and the deal dies.
When you put 5% down on a property, you use an insured mortgage. That means you face a strict 44% debt ratio limit. The math is the math.
But if you disclose your debts on day one, we solve the problem. Different lenders calculate debts differently. Some banks factor in a minimum payment against your debts. Others don’t. Some lenders count your Child Tax Benefit as income. We build a strategy around your exact numbers.
Be fully transparent. Tell your broker everything upfront so they place you with the right lender from the start.
If your appraisal just came in low, don’t accept it as the final word — book a free strategy call with LendCity and we’ll pull the comps, build your case, and find a lender who’ll order a fresh appraisal so your deal stays alive.
3. The Mid-Escrow Job Change
You get pre-approved. You feel great. You decide it is the perfect time to quit your job and start a new career.
Stop right there.
Do not change your job until after you take possession of the property. When you change jobs, lenders see risk. They see probationary periods. They freeze your funding.
There is exactly one exception to this rule. If a company headhunts you, offers you a massive raise—say, $30,000 a year more—and puts in writing that you have zero probationary period, you are safe. We show that to the lender and keep the deal moving.
Otherwise, stay at your desk until the keys are in your hand.
4. The Condo Status Certificate Surprise
Condos carry a hidden landmine: the status certificate.
This document tells you exactly how much money sits in the condo corporation’s reserve fund. Lawyers check this right before closing. If the reserve fund is empty, the lender runs away. They know massive special assessments are coming.
Protect yourself early. Build a condition into your purchase offer. Ask for proof of a satisfactory status certificate before you waive your financing condition.
Buy newer condos when possible. They carry less risk and require fewer immediate repairs than older buildings, keeping the reserve fund healthy and the lenders happy.
If your deal involves a distressed property or weird zoning, most big banks will say no — schedule a free strategy session with us and we’ll match you with a lender who actually understands Purchase Plus Improvements or mixed-use properties.
5. Ugly Houses and Weird Zoning
Investors love distressed properties. Lenders hate them.
You find a beat-up house for a steal. CMHC sends an appraiser. The appraiser takes one look at the missing kitchen and tells the lender the property is uninsurable.
Do not walk away. Use a Purchase Plus Improvements program.
Tell the lender exactly how you plan to fix the property. Show them the quotes. We take those quotes, add them to the purchase price, and show CMHC the future value of the home. They approve the deal because they know the property will meet their standards.
Zoning causes similar headaches. You buy a residential home zoned for commercial use, or a mixed-use building. Big banks instantly reject these. But specialized lenders love them. Work with a broker who knows exactly which lender accepts mixed-use properties or grandfathered zoning.
Build a relationship with a broker who fights for your deals. Give them the truth, let them do the heavy lifting, and watch your portfolio grow.
Frequently Asked Questions
What happens if a property appraisal comes in lower than the purchase price?
Can I hide a private loan or credit card from my mortgage broker?
Why is a 44% debt ratio important in Canada?
Can I change jobs while buying a house?
What is a condo status certificate?
Will a bank finance a house that needs major repairs?
Can I get a residential mortgage on a commercially zoned property?
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Consult a licensed mortgage professional before making any financing decisions.
Written by
LendCity
Published
February 24, 2026
Reading time
5 min read
Appraisal Gap
An appraisal gap occurs when a property
Debt-to-Income Ratio
A lending metric that compares a borrower's total monthly debt payments to their gross monthly income. Lenders use DTI to assess borrowing capacity, with most requiring ratios below 44% for mortgage approval.
Status Certificate
A legal document issued by a condominium corporation disclosing the building's financial health, reserve fund status, pending assessments, litigation, and rental restrictions. Lenders require this before approving condo financing.
Purchase Plus Improvements
A Canadian mortgage program that combines the purchase price with renovation costs into a single mortgage, based on the property's after-improvement value.
CMHC
CMHC (Canada Mortgage and Housing Corporation) is a federal Crown corporation that provides mortgage loan insurance to lenders when borrowers have less than a 20% down payment, enabling Canadians to purchase homes with as little as 5% down. For real estate investors, CMHC insurance is available on owner-occupied properties of up to four units, but is generally not available for non-owner-occupied investment properties, meaning investors typically need at least 20% down and must seek conventional financing.
Mixed-Use Zoning
Mixed-use zoning is a municipal designation
Hover over terms to see definitions. View the full glossary for all terms.