What is a Debt To Income Ratio and why does it matter when you're applying for a mortgage loan?
In short, your Debt-To-Income (DIT) is the ratio of qualifying monthly debt to qualfying monthly gross income. The debts are divided by the income for a ratio used not only by lenders, but credit scoring companies.
Mortgage loan underwriters set caps for acceptable debt-to-income ratios (DIT) in order to limit risk. Acceptable percentages vary by underwriter.
Want to learn about and calculate your Debt To Income Ratio? Start here!
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