Your monthly debt payments divided by your gross monthly income, used by lenders to assess capacity.
The proposed housing payment plus other required monthly debts is compared with income; allowable limits depend on the program, credit profile and automated underwriting.
Paying off a small installment loan can sometimes change qualification more than a larger down payment.
Related terms
Pre-approval— A lender's review of your documented income, assets and credit supporting a specific loan amount.
Educational only: The calculators and information on this website are for educational and illustrative purposes only. Results are estimates based on the information and assumptions entered and are not a loan offer, commitment to lend, financial advice or guarantee of eligibility, rates, costs or savings. Actual loan terms, rates, fees, mortgage insurance and qualification requirements vary by borrower, property, lender and loan program. Speak with a licensed mortgage professional for personalized information.