100% Mortgage Financing With 55% Debt Ratios

Home Loans

100% Mortgage Financing With 55% Debt Ratios
(presented by www.refinance-refinance.net - mortgage lenders)

By Ben Afzal

Basics

Your debt to income ratio is a basic measure that mortgage lenders use. It involves:

Total monthly debt load
Total pretax income
Overall ability to pay

Total Monthly Debt Load Your total monthly debt load that a lender will analyze includes:

Credit cards
Student loans
Car payments
Department store cards
Other monthly debt payments
Your mortgage payment

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This is the sum total of your usual monthly debt payments. In some cases a lender may ignore a debt totally. This is the case, for example, if you have a $500 a month car payment but there are only two more months left on the loan. The lender may choose to ignore this $500 per month debt load because they know if will go away shortly.

Lenders should be able to figure out the monthly debt balances and when they expire from your credit report, although you should also disclose relevant items to them in your mortgage application.

Lenders will also factor in the expense of the new mortgage your are applying for. This includes the mortgage payment, property taxes, home owner association dues, hazard insurance, and any other property related expenses.

Total Pretax Income The lender will add up all your pretax income, which may include:

Base salary
Sales commissions
Bonuses
Overtime
Rental income
Interest income
Other income

All of this income is added together to figure out your pretax income. They may take an average of your past year

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This entry was posted on Saturday, October 7th, 2006 at 4:42 am and is filed under Refinance. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.

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