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Can someone help me understand what items get counted in a DTI calculation? Car payments, food, insurance, etc/

by violet190 from Tokio, North Dakota. May 20th 2016 Reply


Hi Violet,Depending on the type of loan, but typically it is the items that report to your credit. VA also accounts for any childcare expenses. You need a certain amount of residual income for some loan products as well. You are welcome to reach out if you would lkeep further explanation. Clyde Penton NMLS# 979755404.604.7013

May 20th 2016
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Aundrea Beach-Greco (aundreabeachgreco)
#6 ranked lender in Nevada - 29 contributions

The DTI is all your monthly debt reported on the credit report plus the proposed house payment (PITI) divided by your gross income (before taxes). For example, if your proposed house payment is $1500 a month and you pay another $100 a month for an auto loan and $400 a month for the rest of your debts, your monthly debt payments are $2000. ($1500 + $100 + $400 = $2,000.) If your gross monthly income is $6000, then your debt-to-income ratio is 33 percent. ($2000 is 33% of $6000.)Hope that helps. Aundrea 702-326-7866

May 20th 2016
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William J Acres (William_Acres)
#2 ranked lender in Arizona - 7,938 contributions

Calculating DTI is complicated and should be left to the professionals, and the list is so long that posting all the qualifying items would be inefficient.. But in general, Lenders look at the payments associated with your DEBT.. car payment, credit card payment, student loans etc.. we only look at the MINIMUM required payment when determining your DTI. We also add your new mortgage payment as well as any other required fees associated with housing.. PITI, association fee, assessment fees, capital improvement fees, HOA, etc.. We also have to add any payments you make that are mandatory.. such as child support, alimony, payments on unpaid taxes or payments on outstanding collections.. Certain loan programs also require we account for "Phantom Payments" for outstanding collections that you are not paying on right now, but they include a projected payment into your ratio in case, sometime in the future the creditor goes after you and you have to start making payments, the lender wants to know you can make the payment without jeopardizing your mortgage. Things that are NOT considered are your normal bills.. cell phone, car insurance, health insurance, utility payments such as electric, gas, propane, oil, water, etc.. are all ignored.. Really, if you want to know for sure, you should try contacting a a LOCAL mortgage broker and apply with them. Once they see your complete loan profile, they will be better equipped to advise you properly. Also, by applying with your LOCAL Broker, you have an advantage because he's familiar with local customs and works with many lenders with each one offering a different type of lending program. This is unlike the local bank which typically only has a few lending programs. The more lenders, the more lending options, and the more likely your scenario will be accepted.. Plus, the broker is experienced in seeking out the best loan terms for your particular scenario, and he has lower overhead which typically results in lower rates and fees than most of the larger lenders.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. William J. Acres, Lender411's number ONE lender in Arizona. 480-287-5714 WilliamAcres.com NMLS# 226347

May 23rd 2016
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Joe Metzler (JoeMetzler)
#1 ranked lender in Minnesota - 3,524 contributions

The quick answer is anything that shows up on your credit report. Car loans, monthly credit card payments, student loans, etc. Cell phone, utilities (gas, electric) car insurance generally are not added. The long answer is talk to your local mortgage broker, give them a full loan application, and let them provide your specific individual answer. For loans in SD, MN, and WI, visit me at www.WI-MortgageBroker.com

May 24th 2016
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