Finance
What is the maximum debt-to-income (DTI) ratio typically allowed for a conventional conforming loan in Illinois?
A28% front-end DTI; 36% back-end DTI
BNo DTI limit for conventional loans
C43% or up to 50% with compensating factors (per Fannie Mae/Freddie Mac guidelines)✓ Correct
D36% total DTI with no exceptions
Explanation
For conventional conforming loans (those meeting Fannie Mae and Freddie Mac guidelines), the maximum DTI ratio is typically 43-45% back-end DTI, with exceptions allowing up to 50% for borrowers with strong compensating factors (higher credit scores, larger down payments, cash reserves). The 'front-end' ratio (housing costs to income) and 'back-end' ratio (all debt to income) are both considered. These limits apply equally in Illinois.
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