Forgotten Your Password?

Need to Register?

Question Icon

I am currently on an IRS repayment plan which amounts to $218/month for the next 8 months. Is there a way to have this amount not affect my DTI, as it will be paid off shortly?

by k.watkins131 from Hewitt, New Jersey. Feb 18th 2016 Reply


You should call me 862-251-2320

Feb 18th 2016
1
0
William J Acres (William_Acres)
#2 ranked lender in Arizona - 7,933 contributions

Yes.. possibly.. Lending guidelines state that if you have a debt that is within 10 months of being paid off, then it can be ignored for DTI calculations.. but this is at the underwriter's discretion.. If your income is low and your ratios are high, then they might not allow it.. Example: You make $2000 per month and your DTI after removing the $218 from your ratios is 45%... In this scenario, the lender would most likely not remove the $218 from your ratios since you only have $882 remaining to pay your remaining bills as well as accounting for income taxes..But if you make $10,000 per month, and your DTI is 45%, then you would have $5282 remaining after deducting the $218.. under this scenario, you would have plenty of funds left over where it wouldn't be a burden and most likely would be allowed. The only way to know for sure would be to contact 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

Feb 19th 2016
1
0
Joe Metzler (JoeMetzler)
#1 ranked lender in Minnesota - 3,524 contributions

Maybe... Old rules indicated that any installment debt with less than 10 months remaining can be removed from your debt ratio. That has changed recently, and now there is a lot more that goes into the picture to determine if it is possible to remove anything less than 10 months remaining from your debt ratio.

Feb 19th 2016
0
0
Jesse Stroup (jessestroup)
#199 ranked lender in California - 591 contributions

The IRS has to been included in your ratio's; the only way around it is to pay it off in full. You can use FHA financing to purchase or refinance a home (I'm not sure what loan your are looking for) with proof of monthly IRS payments. I hope this helps.Jesse Stroup | Mortgage Banker | California NMLS# 6229 | 510-704-3445Please contact me for more information.

Mar 11th 2016
0
0
Subscribe to our news feed.