Prequalification Calculator

This utility will give you an estimated mortgage payment you may qualify for;
lease contact one of our Financial Services Consultants for more exact information.
Please do not include commas, decimal points, or dollar signs in the form.

How can I figure out my debt-to-income ratio?

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.

- Mortgage companies use ratios to analyze your mortgage payment. The housing payment ratio (or front ratio) used in this calculation is 28% or 29%. The housing expense, or front ratio, compares your total mortgage payment to your monthly income. The total debt expense ratio (or back ratio) is 36% or 41%. This total debt expense, or back ratio, compares your total monthly obligations including your total mortgage payment to your monthly income.

Monthly Income
Salary (Gross):	$
Self-Employment Income:	$
Second Job:	$
Dividends:	$
Interest:	$
Pension:	$
Social Security:	$
Rental Income:	$
Child Support, etc:	$
Other:	$
Monthly Expenses
Car Payment:	$
Furniture Loan:	$
Appliances:	$
Boat or RV Loan:	$
Revolving Credit:	$
Student Loan:	$
Other:	$
Pre-Qualification Ratio:	28/36 29/41
Results
Total Monthly Income:	$
Total Monthly Expenses:	$
Ratio 1 Max:	$
Ratio 2 Max:	$
Max Payment	$
Ratio 1: This is the maximum monthly payment a lender is likely to allow you to carry based on your income alone. Ratio 2: This is the maximum monthly payment a lender is likely to allow you to carry based on income minus payments However, this amount is based on the more generous second number in your ratio.