Lenders like to see a debt-to-income ratio at or below 43%, but loans have been approved up to 50%.
You may have heard of the term debt-to-income when applying for a loan; what does it mean? Debt-to-Income ratio is a comparison of monthly debts to monthly income, this is a major factor for lenders consider when underwriting a loan.
How about if you don’t have a job? You may still be able to qualify as there may be other sources that can be considered as income, such as rental income, social security, and pension.
How about if you have a student loan in deferment? The lender will want to know what will be the monthly payment once out of deferment and will ask you to get it from the student loan company so they can put it into the equation.
If you have a question as to whether your debt-to-income ratio qualifies, ask us and we’ll be happy to help!
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