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Ratio of Debt-to-Income

Your ratio of debt to income is a formula lenders use to determine how much money can be used for your monthly home loan payment after all your other recurring debts are met.


About the qualifying ratio

Typically, underwriting for conventional loans needs a qualifying ratio of 28/36. An FHA loan will usually allow for a higher debt load, reflected in a higher (29/41) ratio.

The first number in a qualifying ratio is the maximum percentage of gross monthly income that can be applied to housing costs (this includes principal and interest, PMI, homeowner's insurance, property taxes, and homeowners' association dues).

The second number is the maximum percentage of your gross monthly income that should be spent on housing expenses and recurring debt together. For purposes of this ratio, debt includes payments on credit cards, auto loans, child support, et cetera.

Some example data:

28/36 (Conventional)

  • Gross monthly income of $3,500 x .28 = $980 can be applied to housing
  • Gross monthly income of $3,500 x .36 = $1,260 can be applied to recurring debt plus housing expenses

With a 29/41 (FHA) qualifying ratio

  • Gross monthly income of $3,500 x .29 = $1,015 can be applied to housing
  • Gross monthly income of $3,500 x .41 = $1,435 can be applied to recurring debt plus housing expenses


If you want to run your own numbers, use this Loan Pre-Qualifying Calculator.

Don't forget these are only guidelines. We will be thrilled to go over pre-qualification to determine how much you can afford. Integrity Lending can walk you through the pitfalls of getting a mortgage. Call us at 941-924-0044. Ready to get started? Apply Online Now.

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Lakewood Ranch, FL 34202