Finance
A Maine buyer's debt-to-income ratio before their new mortgage would be 38%. Adding the proposed mortgage payment of $1,450/month brings the total DTI to 48%. If the maximum DTI is 43%, which option helps the buyer qualify?
AIncrease the mortgage amount
BMake a larger down payment to reduce the loan amount and payment✓ Correct
CExtend the loan term from 30 to 40 years
DUse a variable rate mortgage
Explanation
Making a larger down payment reduces the loan amount, which lowers the monthly payment, which in turn reduces the DTI ratio. This is the most straightforward way to bring DTI within lender guidelines.
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