websiteQualifications Ratios:

It is actually not a rocket science.The math is simple, and the concept is sound. Lenders use a ratio called ” debt to income” to determine your maximum monthly payment after you’ve paid your other recurring loans.



Income Ratio

This is your monthly housing payment as a percentage of your gross monthly income. Your total housing payment consists of principal, interest, property taxes, hazard insurance, mortgage insurance (if applicable) and any condo/co-op or associations fees.

Debt Ratio

This is your total monthly housing payment plus any recurring monthly debt as a percentage of your gross monthly income. Other debts include all other payments such as cars, credit cards, student loans, personal loans, retirement savings, leans, etc.

How High Can they Go? It is

It varies by loan program and other factors, but the approximate range for your debt ratio is from approximately 33% to 43%.

If you total gross income is $5,000 per month, your total housing payment plus recurring debt payments should not exceed approx.. $2,150 for a 435 ratio or $1,650 for 33% ratio.