Maximum Debt To Income Ratios For Mortgage DU Approval

One of the key factors in getting an automated DU approval via Fannie Mae’s Automated Approval System are debt to income ratios requirements.  There are two  different types of debt to income ratios.  The first is the front end debt to income ratios which is the total sum of the principal, interest, insurance, FHA mortgage insurance premium, property taxes, homeowners association divided by the borrower or borrowers total monthly gross income.   The second debt to income ratios is the back end debt to income ratios which is the total monthly housing expenses, including the housing expenses,  divided by the total monthly gross income by the borrower or borrowers.  The back end debt to income ratios include monthly minimum credit card payments, monthly minimum minimum automobile payments, student loan payments, alimony payments, child support payments, and any other minimum required minimum monthly credit payments that is reflected on the credit reports.  Utility payments, cell phone payments, cable television payments, and cable payments are not calculated in computing debt to income ratios.

Maximum Debt To Income Ratios To Get An Approved/Eligible From DU Findings

In order to get an approved/eligible from DU Findings, the maximum debt to income ratios required for the front end debt to income ratios is 46.9% and the maximum back end debt to income ratios required is 56.9%.  A mortgage loan borrower can have 50% back end debt to income ratios and qualify for the the back end debt to income ratios per DU AUS, however, if the front end debt to income ratios surpass the 46.9% debt to income ratios,  they will not get an automated approval via DU AUS.  The only way to get an automated Fannie Mae Automated Underwriting Approval if the front end debt to income ratios are higher that 46.9% is to have a lower mortgage loan amount or a lower mortgage rate.  Another solution in getting a lower front end debt to income ratios is by shopping for a house with lower property tax rates.  If you are with a mortgage lender with mortgage lender overlays where you qualify on back end debt to income ratios but have higher front end debt to income ratios, contact me at 262-716-8151 or at www.gustancho.com .   I should be able to help you.

Gustan Cho NMLS ID # 873293

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