Finance
What is the 'back-end ratio' (total debt ratio) in Delaware mortgage qualification?
AThe ratio of back taxes owed to monthly income
BTotal monthly debt obligations (housing + all other debts) divided by gross monthly income✓ Correct
CThe ratio of the remaining loan balance to the original loan amount
DThe portion of each payment that goes to principal repayment
Explanation
The back-end (total debt) ratio = (Monthly Housing Costs + All Other Monthly Debts) ÷ Gross Monthly Income. Most conventional lenders prefer a back-end ratio of 43% or less. It includes car payments, credit cards, student loans, and other obligations.
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