Today we are going to concentrate on debt to income ratio when trying to get a loan for the homeowners. This is a huge piece of the home buying equation that most people do not take into consideration. The dream of one day owning a home may be hampered by a high debt level. One could be earning a high income, but if his or her debt level is too high, a bank may be very reluctant to grant that individual a loan or even flat out deny one. When starting out, I do not recommend going over 30% of one’s credit card limit; maintain it under 30% as a “rule of thumb”.
Along with one’s history of credit and not missing a payment will keep a potential buyer in good standing to qualify for a home loan. Next time we will discuss another major debt that is making buying a house quite difficult, which is a high car or truck payment.
Romaine Bray Realtor