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wiillrus OP t1_iuhts3s wrote

Reply to comment by twotall88 in Multiple Mortgages and Their Effect by wiillrus

Understood. Those figures do, however, include the escrow as well. Is there a general rule of thumb for DTI threshold? Online searches yield results ranging from 30-40% with 50% as the cutoff in special circumstances. Using a calculator, I’m coming out at 25% or less. The 25% is including my full mortgage amount and student loan payments until they’re formally forgiven.

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twotall88 t1_iuhwllv wrote

It just impacts the rate they are willing to offer you until their individual cutoff that could range between 30-50% depending on your situation and the type of loan you're trying to get.

For example, to get an FHA loan with federal guidelines you have to have 31% or less DTI before the loan (front-end DTI) and 43% or less DTI after the loan (back-end DTI).

For most conventional loans the cutoff is between 45-50% depending on credit worthiness (you can go above this amount if you have really good credit, like near perfect).

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