To figure out where you stand on the debt-to-income ratio, you must first understand the meaning of the figure. Most lenders use the ratio 28/36. The first number, which is also referred to as the front-end ratio, is the percentage of your gross monthly income that you could comfortably afford to spend on your housing payments or mortgage. This figure includes the money you spend on property taxes and insurance as well as the loan payment itself. The second number, which can also be referred to as the back-end ratio, is the percentage of your gross monthly income that should be spent on all long-term monthly debts combined. Use the following guidelines to find out where you stand: - First, figure out your gross monthly income (your income before taxes). To do this, take your gross yearly income and divide it by 12. - Multiply this figure by 28 percent (.28). The amount you come up with is TYPICALLY the amount you could comfortably afford to spend on your housing payments per month. - Now, take your gross monthly income (your gross yearly income divided by 12) and multiply it by 36 percent (.36). The figure shown should be the TOTAL amount of money you spend on ALL LONG-TERM DEBTS COMBINED. To get a more accurate mortgage estimate, tally up your monthly bills - which include car payments, credit cards, child support, alimony, etc. - and subtract this amount from the figure you just came up with. However much money is left over is the amount you should truly be spending on your housing payments per month.
To browse our Real Estate FAQ terms please click the following link: Real Estate FAQRealEstateAgent.com is dedicated to provide the most up to date Commercial Real Estate Questions and Answers available in today's market, we invite you to contact our Featured Real Estate Agents so they can assist you with any Commercial Real Estate Questions you may have.
Chariff Realty Group
Mobile: (786) 223-0207 Office: (305) 576-7474Send Email Website Agent Listings Driving Directories
"" ... view more
Mobile: 1-954-849-4936 Office: 1-954-260-7531Send Email Website Agent Listings Driving Directories
" Se Habla Español ! Viviana 1-954-655-6040 Over 120 Million in Closed Sales, and we are Foreclosure Experts ! Hello and thank you for visiting! It is our goal as your full service real estate company specializing in the Hollywood, Ft. Lauderdale, and Aventura areas, t" ... view more
Coral Shores Realty
Office: 1-954-668-9056Send Email Website Agent Listings Driving Directories
" "Professional Service with a Personal Touch" I specialize in vacation condos & single family homes in the Southeast Florida beach and downtown areas of Hollywood, Hallandale Beach, Fort Lauderdale Beaches and Sunny Isles Beach. I also specialize in relocation, for m" ... view more
Keller Williams Realty Professionals
Mobile: 954-254-6122 Office: 954-630-7026Send Email Website Agent Listings Driving Directories
"Are you looking for an experienced real estate professional who knows the South Florida market, works in a no pressure environment, lets you take your time to make a well-informed decision but aggressive enough to get the results you desire? While there are many agents to choose from, know that " ... view more