![]() Lenders will also review other aspects of your finances, including the following:Ĭredit score:Also called a FICO score, a credit score is a numerical rating summing up how well you’ve paid back past debts. As a general rule, to qualify for a mortgage, your DTI ratio should not exceed 36% of your gross monthly income. To calculate your DTI ratio, divide your ongoing monthly debt payments by your monthly income. Your debt-to-income (DTI) ratio is the percentage of gross income (before taxes are taken out) that goes toward your debt. Lenders will compare your income and debt in a figure known as your debt-to-income ratio. ![]() Lenders look closely at applicants who owe a large amount of debt, since it means there will be less funds to put toward a mortgage payment, even if their income is substantial. Lenders may check not only your income for the current year, but also for past years to see how steady your income has been.ĭebt:This is the total amount you owe to credit cards, car payments, child support, college loans, and other monthly debts. Your income:How much money you bring in-from work, investments, and other sources-is one of the main factors that will determine what size mortgage you can get. Here are the main things they review to determine how much you can borrow: When you apply for a mortgage to buy a home, lenders will closely review your finances, asking you to share bank statements, pay stubs, and other documents. land (where about one-third of Americans live) is located within USDA loan–eligible boundaries. While many assume USDA loans are just for farms or extremely remote areas, 97% of U.S. USDA loans:The United States Department of Agriculture offers loans in rural areas to borrowers with low to moderate incomes. In addition to putting no money down, borrowers also get lower interest rates and other fees. military (and qualifying family members) can get loans backed by the U.S. VA loans:Current and former members of the U.S.It’s ideal for first-time home buyers who lack the money for a large down payment. But if you don’t have 20%, you can put down as little as 3.5%, or in some cases 0%.įHA loan:These loans are backed by the Federal Housing Administration, which means you can put down as little as 3.5% of the price of the house. Rates are as at April 17, 2023, for Equitable Bank's Flex Reverse Mortgage, HomeEquity Bank's CHIP Reverse Mortgage, and Bloom Finance Company Ltd.’s Bloom Reverse Mortgage.To get the best mortgage interest rates and terms, you’ll want a down payment amounting to 20% of a home’s sale price. When comparing a $400,000 advanced principal Equitable Bank Flex Reverse Mortgage with Bloom Finance Company Ltd.’s Bloom Reverse Mortgage, over two 5-year fixed terms at posted rates, a borrower will save $3,785 after 5 years, $10,727 over 10 years, and $22,812 over 15 years. When comparing a $400,000 advanced principal Equitable Bank Flex Reverse Mortgage with HomeEquity Bank’s CHIP Reverse Mortgage, over two 5-year fixed terms at posted rates, a borrower will save $4,056 after 5 years, $11,498 over 10 years, and $24,459 over 15 years. *** Scenario for illustrative purposes only. REM calculator - Scenario for illustrative purposes only ** Based on research conducted by Equitable Bank on May 25, 2023, comparing the posted rates of Equitable Bank’s Flex Lite and Flex Reverse Mortgages with comparable products, including Bloom Finance Company Ltd.’s Bloom Reverse Mortgage, and the CHIP Reverse Mortgage offered by HomeEquity Bank at origination. REM calculator - Based on research conducted by Equitable Bank on Excludes any fees and interest accrued after mortgage due date. Must keep property taxes and home insurance paid and current, maintain property, and keep current all mortgage obligations. * Subject to borrowers meeting their mortgage obligations. Footnotes REM - Subject to borrowers meeting their mortgage obligations. Term Deposits and Guaranteed Investment Certificates (GICs)įeel secure knowing we’re a trusted bank with over 50 years serving Canadians.
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