Front and Back Mortgage Ratios Tool – Debt to Income Ratio

Debt-to-Income Mortgage ratios are important for the mortgage approval process. Mortgage ratios come second only to your credit report as the most important factor an underwriter will look at when reviewing a loan application. Mortgage ratios are frequently referred to as Front and Back Mortgage Ratios and are expressed as “24/32”. The first or front mortgage ratios are your total monthly (principal, interest, taxes, and insurance) housing expense divided by your total monthly income. The second, back mortgage ratio is your total housing expense plus all other monthly debt divided by your total monthly income. For ratio calculation purposes, credit card debt uses the minimum monthly payment. Also, if you have installment debt (car payment) with less than 10 months remaining, that debt can be ignored for qualification purposes.