Mortgage Library

How much Income do I need to qualify ?

Property Information
Selling Price
Monthly Taxes
Monthly Hazard Ins
Estimate Taxes and Insurance

Mortgage Information
Down Payment
Interest Rate
Term in Years
Front Ratio(%)
Back Ratio(%)

Instructions
Enter the price and down payment amount for the property. Enter the initial expected rate and length of the mortgage.

Results

Property Selling Price: $190,000.00

Down Payment: $40,000.00

Loan Amount: $150,000.00

Principal and Interest: $899.33

Monthly Taxes: $174.17

Monthly Hazard Insurance: $95.00

Monthly Mortgage Insurance: $0.00

Total Mortgage Payment: $1,168.49

Income Needed for Payment: $3,894.98

Allowable Debt Payments: $233.70

Explanation

Mortgage companies use ratios to analyze your mortgage payment. The housing payment ratio (or front ratio) used in this calculation is 30%, or (1,168.49 / 3,894.98). 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 [(1,168.49 + 233.70) / 3,894.98]. This total debt expense, or back ratio, compares your total monthly obligations including your total mortgage payment to your monthly income.

You may enter specific information about your annual taxes and hazard insurance, or may select the box to have this calculator estimate your annual taxes and insurance. Any fields you leave blank will be assumed to be zero. In either case, the results displayed above are only estimates of the amount of income you may need to qualify for a loan in the amount you enter. Please consult your tax advisor for information on the deductibility of interest for tax purpose. Refinancing or taking out a home equity loan or line of credit may increase the total number of monthly payments and the total amount paid when comparing to your current situation.