Suppose you want to move out of your apartment and buy a small house. Let$$s assume that your

income is $$39,600$ a year, your student loans cost $$250$ per month, and your car payment is $$325$ per

month. You only use your credit card for gas and pay off about $$100$ monthly. You used an online

loan payment calculator and determined the house payment will be $$725$ per month. Round answer to

the nearest whole percentage point, where necessary. What is your Front$-$End DTI ratio?

b$)$ What is your Back$-$End DTI ratio?

c$)$ Is the bank likely to lend you the money to buy the house?

d$)$ What should your total monthly payments be to keep you in line with the Back$-$End DTI limit

stated by Bankrate above?

e$)$ How much lower should your house payment be to stay within this limit$?$

Answer rating: 100% (QA)

a To calculate the FrontEnd DebttoIncome DTI ratio we need to divide the total housing expenses in t... View the full answer