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To calculate DTI, add up your total monthly debt payments (including the prospective mortgage payment) and divide it by your gross (pre-tax) income.
Although the criteria vary by lender, it’s my understanding that banks want to see a total debt-to-income ratio of 40 percent or less.
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And if you do get a mortgage, how much should you borrow?
These financial institutions work with Lend Key to keep operating costs low, and pass on the savings directly to you.
Community banks and credit unions channel most of their loans to the neighborhoods where their depositors live and work, helping to keep local communities vibrant and growing.
In my opinion, paying 40 percent of your gross income towards debt each month is pretty scary.
Consider that: I would be more comfortable with a maximum debt-to-income ratio of 25 percent.
I make ,000 a year as an engineer and she makes ,000 at a non-profit.