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Points Explained |
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What are mortgage points and when, if ever, does it make sense to pay them? |
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Fees Explained |
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What are the 'real' costs of my California Mortgage? This will help explain exactly where your money is going - and where it shouldn't be going...
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Others Are Saying... |
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"The service was great and so was my rate! There weren't any hassles at all - they listened to my concerns, answered all of my questions, plus I got a better rate than I expected."
Thanks again,
G. Frederickson
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Debt To Income Ratio Formula
Debt-to-income ratio formula is the percentage of a borrower's monthly gross income that goes toward
paying debts. It is usually expressed as two numbers: The 'Front End' and the 'Back End'.
The 'Front End' refers to the
percentage of income that goes toward paying off a mortgage principal and interest, mortgage
insurance, hazard insurance, property taxes, and homeowner's association dues. The 'Back End'
refers to the percentage of income that goes toward paying all recurring debts, including
the 'Front End', and other debts such as credit card payments, car loan payments,
and child support payments.
Most small banks amd local lenders require a debt-to-income ratio of 36% to qualify for a mortgage,
but larger lenders will often permit a 'Back End' Debt to Income Ratio of up to 45% on a
1st Morgage and 50% on a 2nd Mortgage. If you have a higher 'DTI' than 45% there are many
SubPrime' lenders that will allow your 'Back End' ratio to be as high as 55%.
Federal Housing Administration loan ratios are typically 29/41.
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Debt to Income Ratio Formula - Find the formula lenders use to qualify borrowers using this
morgage glossary - Apply Online or Call Us Today at 1-888-835-0761...
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