Real Estate Math
A Michigan buyer's total monthly debt is $2,200 including the proposed mortgage payment of $1,400. Monthly gross income is $5,500. What is the back-end (total) DTI ratio?
A25.5%
B32.7%
C40.0%✓ Correct
D36.4%
Explanation
Back-end DTI = Total Monthly Debt / Gross Monthly Income = $2,200 / $5,500 = 0.40 = 40%. Using the values given ($2,200, $1,400), apply the appropriate formula.. The correct answer is 40.0%.. This is a common calculation on the Michigan real estate exam.
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