Debt to Income definition
Debt to Income means the ratio of the Monthly Debt Obligations for a Consumer on a Loan to that Consumer’s gross monthly income. If a Loan has a borrower and a co-borrower (including a guarantor), Debt to Income shall mean the ratio of the total Monthly Debt Obligations for both Consumers on the Loan to the total of those Consumers’ gross monthly income.
Debt to Income. Ratio (DTI) as a means of determining the borrower's credit grade and to evaluate their ability to repay. Disposable New Century will also evaluate the borrower's "Disposable Income Income". This is determined by subtracting the borrower's "Total Monthly Payments" from their "Gross Income". The following guide is to be used as a tool for underwriters to consider whether a borrower has sufficient disposable income to cover their other living expenses and to provide minimal reserves. Family Size Disposable Income ----------------------------------------------------------------- 1 400 2 600 3 800 4 1,000 5 1,200 6 1,400 7 1,600 Although this table is used as a guide, New Century may use discretion when reviewing borrowers with disposable income below these levels. Continued . . . -------------------------------------------------------------------------------- Policy & Training Development Debt to Income (DTI) Ratios (continued) Maximum DTI Grade Maximum DTI By Grade ----------------------------------------------------------------- A+ 45% A- (45% for LTV's greater than 85%) 50% Mortgage Only Program (M.O.P.) 55% B 55% C 59% C- 59% HomeSaver 59% -------------------------------------------------------------------------------- Policy & Training Development UNDERWRITING / 1st LIENS Policies - Collateral Requirements --------------------------------------------------------------------------[LOGO] Page 1 of 11 (03/03/99) Latest Revised Items in Bold Blue Overview Importance of Due to the nature of Sub Prime lending, the condition and Collateral accurate value of our collateral is an essential part of making Condition the proper credit judgment. The following guidelines are provided and Valuation to assist all NCMC associates in determining the acceptability and the value of the collateral: . Acceptable Property Types ------------------------- . Mobile Manufactured Homes ------------------------- . Property/Collateral Requirements -------------------------------- . Appraisal/Collateral Valuation ------------------------------ . Insurance Requirements ---------------------- -------------------------------------------------------------------------------- Policy & Training Development UNDERWRITING / 1st LIENS Policies - Collateral Requirements --------------------------------------------------------------------------[LOGO] Page 2 of 11 (03/03/99) Latest Revised Items in Bold Blue
Examples of Debt to Income in a sentence
The Borrower may be able to obtain a Co-Borrower to assist him/her in qualifying if the problem with the loan involves lack of income or the Debt to Income Ratio.
CHARACTERISTIC GRADE 1 GRADE 2 GRADE 3 GRADE 4 ----------------------------- ---------------- --------------- ----------------- ---------------- ----------------------------- ---------------- --------------- ----------------- ---------------- Debt to Income < =50% < =50% < =50% < =50% Max.
NON-CONFORMING CREDIT UNDERWRITING CRITERIA Classes of Loans A(1) B C D(2) Warehouse Period 90 90 90 45 Debt to Income 50% 50% 50% 60% Loan to Value 90% 85% 80% 75% Mortgage Loan Maximum $200,000 on any non pre-approved Mortgage Loan.