Debt-to-income Ratios

Financing

Do you qualify for a mortgage loan?  Calculating Debt-to-income Ratios...

If the following sounds like "mumbo jumbo" to you, you're not alone!!  The vast majority of consumers have no idea what it takes to qualify for a mortgage loan, which is why we leave it up to the experts to get you prequalified.  It's really not a scary process, and doesn't take a lot of time, but the answer you receive will allow you tremendous peace of mind when moving forward.

Mortgage lenders will use your debt-to-income ratio to determine how much money you can afford to borrow. It is the percentage of your monthly gross income used to pay your monthly debts (not monthly living expenses). Two calculations are involved, a front ratio and a back ratio, written in ratio form, i.e., 33/38. The first number indicates the percentage of your monthly gross income used to pay housing costs, such as principal, interest, taxes, insurance, mortgage insurance and homeowners’ association dues. The second number indicates your monthly consumer debt, such as car payments, credit card debt, installment loans, etc..

Yes, confusing indeed, to most!  Once you and I have had a chance to speak I can then recommend two or three lenders who may be a good fit for you.  Seriously, you wouldn't select a doctor, or tax preparer to help you if you weren't comfortable with them, correct?  Let me help...

 

Live with Aloha!

Laura