Roberto is applying for a mortgage. He has a monthly gross income of $3,500. The home he would like to buy has monthly payments for a mortgage of $1,000, a property tax of $150, a hazard insurance premium of $75, and a mortgage insurance premium of $75. Roberto also has other monthly debts totaling $500 per month. Would he qualify based on the FHA total fixed payments-to-income ratio?

Question

Quizplus · Accepted Answer

Roberto's total fixed payments include mortgage ($1,000), property tax ($150), hazard insurance ($75), mortgage insurance ($75), and other debts ($500), totaling $1,800. Dividing this by his gross income of $3,500 gives a ratio of 51.4%, which exceeds FHA guidelines, typically capped at 43%.

Roberto Is Applying for a Mortgage