I am looking to buy in the next few months if all goes well, but i want to do conventional mainly because of PMI (FHA is just absurd as I feel i would be wasting money I could put towards more house).
My question is, is it common for conventional loan lenders to stray away from 36% back-end for the DTI ratio? At 28% front end i am more than fine with (I don't want to even spend what that 28% is as mine will fall around 20%), but it is the back-end where i am running into issues with. I have ZERO credit card debt, but my issues come with student loan debt. Besides that i only have an auto loan.
My total monthly debt is $773 and that will not change anytime soon so no option in paying something else off (at least not for another 2 years). My monthy gross income is $3916.
My credit scores are roughly 700, but i do have derogatory marks on my credit (paid) that should be removed by May 2014. Because of my current situation I may not be able to wait until everything is removed.
Is there a chance i could get a conventional loan with a back-end ratio higher than 36%? Maybe 41%? I do receive yearly raises and bonuses...
Again I do not want to go FHA if I can help it. I will not have 20% to put down either...
