Finance
The debt-to-income (DTI) ratio used by mortgage lenders measures:
AThe loan amount compared to the property's appraised value
BTotal monthly debt payments as a percentage of gross monthly income✓ Correct
CNet income after taxes compared to housing costs
DCredit card debt compared to installment loan debt
Explanation
The DTI ratio compares a borrower's total monthly debt obligations (including the proposed mortgage payment) to their gross monthly income. Lenders use DTI to assess the borrower's ability to manage monthly payments.
Related Utah Finance Questions
- A Utah borrower is required to be given a copy of their appraisal report:
- An adjustable-rate mortgage (ARM) in Utah has a 5/1 structure. This means:
- A Utah veteran purchasing a home with a VA loan is required to pay:
- A due-on-sale clause in a Utah deed of trust:
- Under TRID (TILA-RESPA Integrated Disclosure) rules, within how many business days of application must lenders provide the Loan Estimate?
- An impound (escrow) account for a Utah mortgage requires:
- A USDA Rural Development loan in Utah is available for properties located in:
- In Utah, a trust deed (deed of trust) is used instead of a mortgage. The key difference is that a trust deed involves:
Practice More Utah Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Utah Quiz →