Separate from mortgage rates, inflation directly affects your debt-to-income ratio
. This is because your other necessities and luxuries cost more as inflation rises.
Income was $60,000 for the non-white and $80,000 for the white, but the debt-to-income ratio
was only 1% for the non-white shopper, while it was 38% for the white.
Currently, 8% of households in Canada have a debt-to-income ratio
of more than 350% of their gross income.
The overall debt-to-income ratio
, which includes mortgages, is expected to rise to 164 per cent in the same period.
Compared to FHA borrowers, their borrowers in 2015 had a slightly higher median credit score and a slightly lower median debt-to-income ratio
, but the median borrower made no down payment at all.
[USPRwire, Thu Jan 01 2015] After 2011, the Canadian economy decelerated from the strong rebound after the recession which led to growing caution by consumers due to already high debt-to-income ratio
and cooling housing market.
That's especially true if you don't quite fit the mold -- you don't conform to all the underwriting mandates on credit, income, debt-to-income ratio
and other criteria.
The defaulting borrower could seek legal remedy if the bank approved the loan with little to no documentation and if the borrower's debt-to-income ratio
is higher than 43 percent.
It's more of a task for individuals to prove their debt-to-income ratio
without the proper documentation, even if they have a high net-worth and perfect credit.
Truth: Lenders look at your entire financial picture, including your assets, available cash flow, and debt-to-income ratio
. They'll also review your housing expense-to-income ratio, which is a comparison of your expected monthly mortgage payment with your gross monthly income.
To ensure you're not setting yourself up for trouble, calculate your debt-to-income ratio
. Here's how to do it: Divide your monthly loan repayments by your gross income, including your bonuses and other regular incentives.
Nationally, students who major in the humanities take home less money and have a significantly higher debt-to-income ratio
, a key indicator of one's ability to repay, than those who major in engineering or computer science.