Mortgage Question - Rental Information

[Anonymous]

Hi there, currently shopping around for a mortgage and been playing around with some calculators and I've noticed a massive difference when I enter our current rental payment per month ($500 - renting from family) and when I remove it.

The difference is about $100,000 in the size of mortgage we would be able to attain.

Question is, do we have to provide the rental amount on our application? I mean, $100,000 is a massive difference, and in all honestly, we know that $500 a month just turns around and gets applied to the mortgage anyways.

Is there some work around on this?

Thanks.

[Anonymous]

I assume you mean that your DTI is limited becasue you are counting your current rental rate.  Once you buy a house, you will no longer have this.

One thing, in this market, lenders are very leary of people who are applying for mortgages that are way above their current rental rate.  It''s called payment shock and UW are leary of that.  If your file is strong otherwise, it's no big problem.

[Anonymous]

Debts don't include rent or monthly utilities, cell phone, optional bills like insurance, etc. They're looking for credit card payments and loans (car, school, etc) mostly. Other obligations like alimony and child support are also included in debt ratios.