Mortgage Lenders Are Crazy!!!
This is a simple word of caution to anyone seeking a home loan out there. If you think that banks and mortgage lenders are rational business people, think again. Just as they were insane before the housing crash by lending to anyone with a heartbeat and probably some without heartbeats, the are equally insane now with their over cautious lending practices.
I have client who was supposed to close on their loan on June 30th and they are still waiting. The reason? The home they are buying is owned by a trust. I don’t want to get into what a trust is except to say that people set up trusts so that when someone dies they can avoid probate and the trust can sell or transfer the property to whomever.
It is not very complicated, the transaction is the same as any other. Except the lender is making it soooo difficult, requesting one stupid document after another, none of which really have anything to do with trust. The latest request is that the bank would now like a copy of the the sellers death certificate. First of all — the seller is the trust (They Know that), secondly, do they not believe that the person actually died????? Can you tell that I am a little P O’d?
I guess, my advice to you is that if you are in the process of buying a home, make sure all your ducks are in a row and your loan is cleared to close well ahead of the closing date. In this day and age you never know what kind of crazy conditions the lender will require before they actually lend you the money.
Avoid and complications and Get Your Approval Completed Quickly At Lending Tree
Debt To Income Ratios
Debt To Income Ratios
Your debt to income ratio is simply a measurement to determine how much of a mortgage you can afford. The number is arrived at by deviding all of your monthly debts (including your total housing expense) by your gross monthly income. 
Qualifying Ratios
It is important to know what your debt income ratio will be. If it is too high, you will not qualify for a mortgage. Fannie Mae and Freddie Mac as well as FHA like to see Debt to Income Ratios around 33%. This however is not carved in stone. I have seen people with ratios at 50% still get approved. Although it is much harder to do so.
Understanding the qualifying ratio
It is important to understand the concept of DTI before you begin to shop for a home or a refinance. If your DTI is too high, you can make the proper adjustments by paying off some debt or somehow reducing your monthly burden in order to qualify for mortage money.
As mortgage guidelines tighten, you must be aware of just where you stand. Before you apply for a mortgage, do your homework. Look at all the debts on your credit report. If possible, try to pay down as much debt as you can before the mortgage process begins.
The lower your debt to income ratio is, the easier it will be to get approved and the easier it will be for you to make your mortgage payment every month.
