Your income must meet the following two conditions:
- Your total housing payment, as a guideline, should not exceed 28% of your gross (before taxes) monthly Income.
- Your total debt payment (total housing payment
plus other monthly debt payments, as a guidelines, should not exceed 36% of your
gross (before taxes) monthly income.
DISCLAIMER: The prequalification figures above are based on conventional fixed-rate guidelines of affordability
ratiosof 28% of gross monthly income for principal,
interest, taxes and insurance (PITI), and 36% of gross monthly income for PITI, plus all other
revolving and installment debt over 10 months in duration. Other factors, such as excellent
credit scores, liquid reserves, non-taxable income, years on the job, etc. could mean that you may
be approved for higher ratios and/or loan amounts. If you have less than 20% equity
in your home, mortgage insurance may be required, although programs do exist where the lender pays
the premiums, or we can arrange for "blended" first and second liens. Calculations by this
tool are believed to be accurate, although not guaranteed. It is always best to speak to one
of our experienced Mortgage Consultants to review the specifics of your own personal
financial situation to obtain the best program and rate/point structure for you.
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