What do lenders mean, when they use the term, Ratio?

They are referring to the ratio between a borrower’s total gross income and his debts. Lenders
look at 2 ratios, the front ratio and the back end ratio. The front ratio
means, the borrower’s housing debt v. their total income. The back end ratio
means, the total debt (housing debt plus car loans, student loans, credit
cards, and personal loans) v. the borrower’s total income.

Right now, lenders want to see the front ration around 33% and the back end ratio to be under 45%
of the borrower’s total gross income.

With an FHA loan, lenders may let you go as high as 50% for the back end ratio.

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