Mortgage Programs and Services
Knowledge Center
Financing your First Home
Using your Home Equity
Refinancing your Mortgage
Buying vs. Renting
Lowering your Monthly Payment
Home Remodeling
What is PMI
Eliminating PMI
Should you buy points
Escrow Accounts
Locking the Rate on your Loan
Debt to Income Ratio
Minimum Down Payment
Title Information
Closing Costs
Getting an Appraisal
Mortgage Tools and Calculators
Apply for Mortgage Online
About Us
Site Map
Services
Links

Debt to Income Ratio


This ratio affects your buying power... Your debt to income ratio is a simple way of showing what percentage of your income is available for a mortgage payment after all other continuing obligations are met. This ratio is one of the many things a lender considers before approving your home loan. You may see conventional loan debt limits referred to as the 28/36 qualifying ratio. Those numbers refer to two percentages that are used to examine two aspects of your debt load.

The First Number, 28%

This number indicates the maximum percentage of your monthly gross income that the lender allows for housing expenses. The total includes payments on the loan principal and interest, private mortgage insurance, hazard insurance, property taxes, and homeowner's association dues. (Often referred to by the acronym PITI.)

The Second Number, 36%

This number refers to the maximum percentage of your monthly gross income that the lender allows for housing expenses plus recurring debt.

Recurring debt includes credit card payments, child support, car loans, and other obligations that will not be paid off within a relatively short period of time (6-10 months).

Debt to Income Example

Yearly Gross Income = $45,000 / Divided by 12 = $3,750 per month income

$3,750 Monthly Income x .28 = $1,050 allowed for housing expense

$3,750 Monthly Income x .36 = $1,350 allowed for housing expense plus recurring debt.

Not All Loans Are the Same

Apply at Synergy Mortgage Today

Secure Online Application
CONTACT: Synergy Mortgage, Inc.,
127 Route 94 South, Suite 1, Warwick, NY 10990
Registered Mortgage Broker, New York State Department of Financial Services, All loans arranged with third-party providers
NMLSR: 32146
Phone: (845) 987-1969

HELP: Contact Us Site Map Mortgage Knowledge Center Glossary Links
SERVICES: Credit Report - Your FICO Score Mortgage Newsletter
TOOLS: Mortgage Calculator What Can I afford Calculator Mortgage Refinance Calculator
MORTGAGES: Refinance30 year fixed 15 year fixed Home Equity Loans Mortgage Refinancing Debt ConsolidationHome Improvement Loans New York Mortgage Programs Equity Mortgage

2009 Synergy Mortgage Corp. all rights reserved. Home mortgages subject to credit review and approval.