Mortgages out of reach for one-third of Americans, study finds

Uncertainty in the loan market is primary reason for why banks will no longer loan to these people. 

"Today's tighter credit is a predictable response by banks after the foreclosure crisis, but [it] also keeps a cap on housing demand," said Zillow chief economist Dr. Stan Humphries in prepared remarks. 

"Four years ago, in the era of easy-to-get subprime loans, many borrowers with low scores did buy homes, which in turn helped contribute to a housing bubble," he added. 

The inability for many to purchase a home comes as interest rates are at historic lows, which are out of reach for some with higher credit scores.

In the first half of September, borrowers with credit scores of 702 or above got an average low annual percentage rate of 4.3 percent while borrowers with scores between 620 and 719 received interest rates between 4.73 percent and 4.44 percent. 

"[The] irony here is that so many American can't qualify for these low rates, or can't qualify for a mortgage at all," Humphries said.