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Valued Member
Posts: 33
Registered: ‎05-10-2010
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Re: DTI question ;-)

The way they look at your DTI is you monthly gross-- so if yout have 1 months worth of pay stubs at 40hrs * $13 that gives you a gross monthly income of $2253.  The going rate for back end ratios is 45%, so $1014.  Then you take out that car payment of $298 and that leaves you $716 for your Princ, Interest, Taxes, Insurance, PMI (if not putting 20% down), and HAO (if any).

 

If your pay stubs and\or W2's do not support the 40 hours a week at $13, that will go down.  Losing the car payment will give you $298 more to play with for you mortgage payment.  If you are close to paying it off, you may want to just wait a little while and re-apply.  Once you are down to less than 6 Months remaining payments, most lenders will not include it in your debt to income ratio calculation anyway.

 

Otherwise, as the other members suggested you can have your husband refi it in his name only and get it off your report that way but if his scores are as bad as you mentioned that may not be a viable option.... or if you have equity in your car, as someone mentioned earlier selling it and using the proceeds to buy something with cash for a while, might be an option.

 

Good luck!


Starting Score: EQ 740, EX 792 (lender pull), TU 772 (lender pull)
Current Score: EQ 767, EX 792 (lender pull), TU 772 (lender pull)
Goal Score: 2 over 760 and one over 800--still looking to get one over 800!


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Established Contributor
Posts: 568
Registered: ‎08-24-2012
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Re: DTI question ;-)

Thank you.  Smiley Happy The car is nowhere near being paid off, so that is def not an option. We are going to have to wait, and hope to clear his credit without TOO much of a hassle, and just wait it out. It's just not our time to buy!  Smiley Happy

"When you are down in the mouth, remember, everything turned out ok for Jonah."

Current FICO's(by lender) 10/9/12
EX:649, EX:651, TU:683
Moderator Emeritus
Posts: 7,225
Registered: ‎09-16-2011
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Re: DTI question ;-)


StartingOver10 wrote:

I don't think its the lender that has given up easily. Maybe their lender overlays are more strict than another lender might be for the same amount.

OP, what you might want to do is speak to a mortgage banker and get the actual info for your ratios.  An experienced loan officer can do all of that for you without running your credit initially. The ratios are strictly math based on the income and expense. You didn't give us enough info to help you, but just based on your initial post I would say your car payment killed any sort of financing. If that is the whole issue then have your husband refi the vehicle into his name alone. Before you do anything though speak directly with a knowlegable LO so they can show you what your ratios are now and where they need to be in order to accomplish where you want to go. Remember, mortgage bankers are going to allow a higher back end ratio than most of the big box lenders today. If you're still too high for the bank end then sell your vehicle and get something for cash (provided that helps with your ratios).


+1 on talking to the LO about your ratios.  Even refinancing the car into your husbands name at a higher rate might help... but if you're in a community property state it won't help at all.  I 2nd the idea of selling the car


Starting Score: 08/29/2011 TU 671 EQ 674
Current Score: TU 754 EQ 694 EX 697
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Moderator Emeritus
Posts: 7,225
Registered: ‎09-16-2011
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Re: DTI question ;-)


StartingOver10 wrote:

I don't think its the lender that has given up easily. Maybe their lender overlays are more strict than another lender might be for the same amount.

OP, what you might want to do is speak to a mortgage banker and get the actual info for your ratios.  An experienced loan officer can do all of that for you without running your credit initially. The ratios are strictly math based on the income and expense. You didn't give us enough info to help you, but just based on your initial post I would say your car payment killed any sort of financing. If that is the whole issue then have your husband refi the vehicle into his name alone. Before you do anything though speak directly with a knowlegable LO so they can show you what your ratios are now and where they need to be in order to accomplish where you want to go. Remember, mortgage bankers are going to allow a higher back end ratio than most of the big box lenders today. If you're still too high for the bank end then sell your vehicle and get something for cash (provided that helps with your ratios).


The reason I suggested that the LO gave up is that I ran into a situation where my DTI is very high on the back end because I owned a home (rental property) that I was keeping in addition to the new home I was purchasing...  A good LO will explain the ratios and may be able to make suggestions or think of ways to improve your DTI. In my case the broker figured out that the rental income on the side of the duplex I used to live in wasn't being included in my net rental income. I had a fully executed lease, had received a deposit, and had 8 months of rental income checks that showed up like clockwork on the first of the month which helped my DTI get the final squeeze that it needed.  seems like $150 is such a small amount to lose approval over... a simple refi of existing debt may give you the $150


Starting Score: 08/29/2011 TU 671 EQ 674
Current Score: TU 754 EQ 694 EX 697
Wallet: NFCU Visa Sig 25k, Amex Lowes 22k, NavCheck 15k, Amex PRG, Amex Zync, Discover It 13.5k, Amazon Visa 5k
Platinum Spade Garden Club Member: App Free since 1/1/13. No more apps til who knows when?
MyFICO Fitness Goal: 800s Club!



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Established Contributor
Posts: 568
Registered: ‎08-24-2012
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Re: DTI question ;-)

I hope this is not a completley ridiculous question, lol, but what is a community property state? Im in FL by the way! Smiley Happy

"When you are down in the mouth, remember, everything turned out ok for Jonah."

Current FICO's(by lender) 10/9/12
EX:649, EX:651, TU:683
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Super Contributor
Posts: 6,870
Registered: ‎03-06-2010
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Re: DTI question ;-)


S7 wrote:

I hope this is not a completley ridiculous question, lol, but what is a community property state? Im in FL by the way! Smiley Happy


You are not in a community property state. FL is not a community property state so that helps you purchase without your husband.

I have an excellent mortgage banker I use all the time (I'm in Fl too). If you want his name, PM me.

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