Financing in Santa Barbara>Question Details

Mrscinsb, Home Buyer in Santa Barbara, CA

What is the Earnings to loan ratio required these days on a $100,000 loan?

Asked by Mrscinsb, Santa Barbara, CA Tue Nov 25, 2008

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Hi,

Lori gave you a good answer. I think you are talking about the debt-to-income ratio. That is the ratio when you divide you gross income by the PITI on the mortgage + your cosumer debt monthly payments (auto loans, credit cards, student loans etc...).

Lenders will go above the standard ratios if you have compensating factors (good credit, money in the bank, long time on job). The ratios can get up into the high 50% with compensating factors. But even if you can get approved at high ratios, really think deeply whether that housing payment is something you can afford comfortably month after month.

Warm Regards,
Rob Chomentowski
Sr. Loan Officer
rob@affinty-financial.com
858-922-7899
0 votes Thank Flag Link Tue Nov 25, 2008
This depends on a few more things.

* What are the taxes and home owners insurance
* What is your other debt (revolving - things that show up on your credit report)

On an FHA loan your ratios are 31/43 -31 % front end ratio which includes housing payment divided by debt. The back end ratio is 43% - that is all your revolving debt plus your housing expense divided by your income.
I have seen loan get accepted with higher ratios with great credit scores and a few months cash reserves.

Go to our website http://www.myallied.net for calculators to help you figure it out. Good Luck!
Web Reference: http://www.myallied.net
0 votes Thank Flag Link Tue Nov 25, 2008
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