How to Calculate Your Debt to Income Ratios (DTI) First Time Home Buyer Know this!

Рет қаралды 88,643

Күн бұрын

Learn How to Calculate your Debt to Income Ratio or DTI as a first time home buyer when buying a house, this is a great way to figure out how much house you can afford and whether NOW is the right time to buy a home! In this video, I discuss what debt to income ratio is, why debt to income ratio is important and how to calculate DTI.
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Hi, I’m Nicole Nark, a full-time Realtor® at HomeWay Realty Realty in Little Rock. I came to Little Rock with the love of my life, I am a proud Mom of two furbabies (Mini Schnauzer Mix and German Shepard), a Graduate of Communications from the University of Arkansas-Fayetteville and Honor Graduate of Arkansas Real Estate School in Little Rock.
I believe that home ownership lays the foundation for a life of financial security and freedom.
From building equity in a home, to the tax benefits it provides, buying a home is the most important financial decision most people make during their life. For this reason it is important to work with a professional who is committed to act as an advocate for you and your best interests.
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Пікірлер: 266

@rahmothcolby5908 11 күн бұрын

Knowledge weighs nothing, but is invaluable. Thank you

@NicoleNark 11 күн бұрын

My pleasure!

@hooksknotslove1528 2 жыл бұрын

Thank you for educating us how DTI is calculated. I have spoken to several Lenders and didn't quite understand how our debts affected the pre-approval amount. Now it's very clear and after watching this, we will hold off our decision to buy.

@DansChan995 2 жыл бұрын

Your explanation was paced at a speed I could understand, and your visuals were easily comprehensible. Thank you so much for this useful introduction.

@afropoppette 2 жыл бұрын

Through this video and an online DTI calculator, this has given me a lot of great information. Thank you!

@lena5633 3 жыл бұрын

I have just hit subscribed. Thank you, for explaining simply the rationales behind these numbers

@fayeinwonderland 2 жыл бұрын

This is the only video that made me understand! Thank you!

@FreshDriveway 2 жыл бұрын

You are absolutely my new favorite real estate channel on KZfaq. Thank you!

@NicoleNark 2 жыл бұрын

Thank you Salem!

@TheMissfxx99 2 жыл бұрын

Thank you for how you explained this in detail.

@VisualFrank 3 ай бұрын

Perfect explanation and great job explaining different scenarios!

@KrissyTheIntrovert 3 жыл бұрын

Simplicity at its FINEST👌🏾👌🏾

@organogold8 3 жыл бұрын

Awesome video and well explained! I appreciate the much neeeded information 😊

@LifeWithCandis 3 жыл бұрын

Very easy to digest thanks!! 🙏🏽

@malisehargrove8971 3 жыл бұрын

Soo good! Thank you! I am starting to think about buying a house/ land. I just found your channel so that is perfect timing :) love how straight forward your videos are!

@NicoleNark 3 жыл бұрын

Thank you so much! I am happy to hear that my videos have been helpful to you! If you have other questions/topics that you want to know more about, please let me know! I'll make some videos for them 😊

@rayofsunshan Жыл бұрын

Thank you for this! It was very clear and concise.

@lauriee.6680 2 жыл бұрын

This is a very clear explanation. Best video on this topic I’ve seen. Thank you!

@NicoleNark 2 жыл бұрын

Thanks for watching!

@genevievesylvester5968 Жыл бұрын

you are wonderful teacher!!! Thank you for explaining this.

@RajeeyahSahar 10 ай бұрын

This breakdown was very easy to understand. Thanks

@Givetheflowers 2 жыл бұрын

This was an awesome breakdown. Thank you so much.

@al5152001 3 жыл бұрын

Beautiful!!!! Nicole

@kerrycopes3059 3 жыл бұрын

So helpful! Thanks

@carissacantu8362 3 жыл бұрын

Thank you so much...I appreciate your time and clear explanations!!

@NicoleNark 3 жыл бұрын

You are so welcome! Glad it was helpful! 😊

@kapekacava 3 жыл бұрын

Thank you so much I love the way you explain so clearly! I live in Texas and I hope to find someone like you here!

@NicoleNark 3 жыл бұрын

You are so welcome! Wishing you the very best on your home buying journey! Let me know if I can help in any way. 😊

@javidiqbal4056 Жыл бұрын

I am Pakistan. It is very good lecture DTI and understand easy.

@freshstart465 2 жыл бұрын

Thank you

@renerecio9070 9 ай бұрын

Thanks for your dti advice

@TC-jw4ot 2 жыл бұрын

Thank you nicole

@LuzHarrell Жыл бұрын

Thank you so much for this video. It was very informative.

@manuatxurra0819 2 ай бұрын

THANK YOU

@lissette1886 3 жыл бұрын

Perfect explanation! Thank you so much!😊

@NicoleNark 3 жыл бұрын

You're very welcome!

@spalmer1773 2 жыл бұрын

Thank you for explaining this so clearly.

@NicoleNark 2 жыл бұрын

Happy to help!

@pauldeloney296 3 жыл бұрын

Thanks for the information.

@jermam2010 Жыл бұрын

Thank you I really appreciate the time and explanation I feel confident I can afford a house

@parler8698 10 ай бұрын

Very informative video!

@Amzad92333 3 жыл бұрын

your accents are very clear with well explained.

@NicoleNark 3 жыл бұрын

Thank you! 😃

@nicolecarson9067 Жыл бұрын

Awesome extremely informative I now have a better perspective of debt to income for buying my first home 👍

@fcolon1976 3 жыл бұрын

Awesome explanation 🙂👍

@mxdluv21 2 жыл бұрын

very easy to understand . thank you

@SP-tm7sd Жыл бұрын

Great tool! Thank you 😊

@freedom102764 4 ай бұрын

Thank so much. This was really helpful

@NicoleNark 4 ай бұрын

Glad you thought so!

@inspire7119 5 ай бұрын

Excellent explanation, thank you breaking it down clearly.

@NicoleNark 5 ай бұрын

You're very welcome!

@cindyhughes4599 Жыл бұрын

What a great video , thank you so much

@aliciarichardson3844 2 жыл бұрын

Thank you for this DTI calculation.

@NicoleNark 2 жыл бұрын

Glad it was helpful!

@jamieobryan7036 2 жыл бұрын

Thank you for this video. Helps me actually understand this.

@NicoleNark 2 жыл бұрын

You're very welcome!

@MarcosGarcia-pj9td Жыл бұрын

Thank you Nicole for your expertise. I will be reaching out to you to see about the USDA path to home ownership. Blessings to you!

@IDBL123 Жыл бұрын

Great video ! ❤

@NicoleNark Жыл бұрын

Thank you!!

@isabelcampos5051 2 жыл бұрын

Gracias, muy claro como lo explicas. Hablo español , entiendo poquito Inglés, pero lo explicas también que es bien entendible, gracias

@Foreversneakz 2 жыл бұрын

Thanks for the info Nicole 😘

@NicoleNark 2 жыл бұрын

Absolutely! Happy to help!

@sapphire6107 2 жыл бұрын

Thank you Nicole. Your explanation is the clearest that I could understand.

@lena5633 3 жыл бұрын

Very helpful

@cairocolumbus6636 2 жыл бұрын

Thank you 😊

@sherryboyd9176 3 жыл бұрын

My parents are from Arkansas. I am seriously considering buying my first home but working on credit and paying down debts

@techchika Жыл бұрын

Thank you, Thank you. THANK YOU .. That was a great explanation...I was unable to figure it out on the online DTI calculator..lol

@OverRated-ot7rz 3 жыл бұрын

Great VID THANK You!!!!!!

@D_it_Dude 7 ай бұрын

I’m a Disabled vet that makes over well over 6figures per year and I have 0 debts no credit card no car payment and I was told today that I no longer qualify for my loan. I had 1 job paying 140k per year which I lost due to layoff And one paying 110k per yr which I still have And I get disability income of 2500 per month. This is the America I bled for.

@growingwithdoni6373 2 жыл бұрын

Super helpful! I'm def starting to feel more confident about being able to afford and get approved for a home loan. :)

@NicoleNark 2 жыл бұрын

You’ve got this! I was terrified about the process when I bought my first house but the more I learned, the better I felt!

@shirleymorales1340 3 жыл бұрын

You are so awesome and thank you so much.

@NicoleNark 3 жыл бұрын

You are so welcome😊

@AshokKumar-cr8xy 2 жыл бұрын

Got it Thank you...

@gumecindoblancasgb3 Жыл бұрын

Very helpful! Thank you so much!!

@NicoleNark Жыл бұрын

Glad it was helpful!

@rodaraguz Жыл бұрын

Why is Nicole so cool and clear and smart? This is the type of stuff High Schools should teach. Not “Texas History”, something no one cares about. I bet not even colleges teach. Nicole is amazing!

@dtrudelle 7 ай бұрын

More money to be made off of people when they don't know about finances. Keep 'em dumb you know?

@ashakuldip1657 3 жыл бұрын

Thanks for sharing this information.

@NicoleNark 3 жыл бұрын

My pleasure

@csewell8598 3 жыл бұрын

I to buy a second home con i get 5 % pay down

@danibo47 11 ай бұрын

Oh wow, we may have been ready years ago😮

@patoneme6409 3 жыл бұрын

I just found your channel and....I Love It!! Thank you, thank you, thank you for educating inmigrants like me!! Now: what if I have NO Debts AT ALL!! What will my DTI ratio will be???

@kesangdorji1987 2 жыл бұрын

I understood DTI.

@MomentsbyKareem 2 жыл бұрын

That trap beat is litty

@imrankher4605 3 жыл бұрын

Good information thankyou

@NicoleNark 3 жыл бұрын

You're welcome:)

@Rosalva24 2 жыл бұрын

I love your explanation. Now, how about the other expenses like, utilities and home expenses?

@saifsalim8702 2 жыл бұрын

Thank you sweetie, love you 😘

@lucylu530 Жыл бұрын

Also include alimony and child support obligation in DTI ratio

@lynnmazon1654 2 жыл бұрын

Yes 👍 I now get it! Why does my lender want to sell my car in order to qualify for a home loan? My car payment is $442.85 and my bal is $3900. I bought this car in 2016 off the showroom and it only has 3900 miles on it…

@andrushayakushev6140 Жыл бұрын

To find fast 45% debt ratio just multiply your income 5000 by 0.45. In example 5000 × 0.45 = 2250 $

@sharkwhisperer7326 2 жыл бұрын

I owe about $50,000 in credit card debt that has my score unacceptable for a home loan right now. Best thing I can do is pay down as much as possible in the next 18 months and then see about where everything looks. There's no way I can get approved at this time, there's too many derogatory marks on the report, now I see how to play the game.

@ourthreeacres7816 2 жыл бұрын

If my husband was self employed the past twenty years and he has now started a new job within the same field but for a company, how long do we need to wait to apply? Do we wait for a whole year after him starting to file taxes to show his yearly gross? We had trouble in the past getting approved since he was self employed and after deductions his pay didn’t look like a lot. This is all new to us.

@dannyela4436 3 жыл бұрын

What’s would be the total amount you think we should have in savings for a house aside from grants and loans? I understand we don’t need to have a big amount of savings because of the programs or loans but what would be a safe zone per say for ourselves to finally say ok we think we’re ready to commit into searching for a home? We’re looking into start with our home process but so far we only have around 5,000 in savings I’m a little worried that it won’t be enough after grants or the loans but we would be a first time home buyers

@username-t1x Жыл бұрын

Clear, simple, and helpful. Thank you for the content!

@NicoleNark Жыл бұрын

Glad it was helpful!

@lynnkeikilani 2 жыл бұрын

I just discovered your videos and I love the thorough explanations in easy to understand language. If I am self employed, which figure on my 1040 tax returns do I use to calculate gross wages? Thank You!

@NicoleNark 2 жыл бұрын

I am so happy that you find the videos helpful! 😊 As a self employed individual lenders are going to look at your net income after deductions. They will look at your most recent 2 years of tax returns and divide the net income by 24 months to give them a typical monthly income. One of the big obstacles is the fact that it is net income. When I buy homes, I have to go through the same process.

@thafutureonline619 Жыл бұрын

I pulled from my 401k and paid off my car and credit cards and then just saved the rest. looking to buy a house by the end of this year fingers 🤞

@martinsimko5308 2 жыл бұрын

Great video. Thank you. Is IRS tax payment plan calculated into debt income ratio? Thank you.

@edwardroberts8046 2 жыл бұрын

What is included in the mortgage payment? Just principal & interest? Or other things?

@bluephone1328 2 жыл бұрын

The video was very interesting but im just curious, rather than all the dividing to find out the dti to find the 45%. If you know your gross income, why not just find 45% of whatever the gross income is? It seems much simpler. Then figure out your debts and whats left would be what you qualify for with a mortgage payment.

@jesslynn9086 3 жыл бұрын

If I am married will debt to income ratios be combined? Great content. I’ve already watched 3 videos, will subscribe now ☺️

@mikesoliman6724 3 жыл бұрын

Wow truly you are Amazing I finally got it , I watched so many similar videos I was not able to get it , I hope you don’t mind if I send your videos to my friends?

@NicoleNark 3 жыл бұрын

Happy to help! Please share! 😊

@kandiloois2881 2 ай бұрын

If you’re paying off IRS or any other payments that are being drafted from your checking acct The mortgage company’s will factor that in I pay 250 a month for IRS payments that aren’t on my credit report And the mortgage company added it to my debt to ratio Child support alimony anything youre paying except utilities phone bill They want to know and the mortgage companies will find out when they pull your bank statements

@johnwmcdonnell2192 2 жыл бұрын

If I'm refinancing my mortgage, combining my 1st and 2nd mortgage, do I use my "Pre" or "Post" refinance mortgage amount for calculating my DTI?

@jaybartgis5148 Жыл бұрын

Are property taxes, pmi, and homeowners insurance included in this calculation?

@NurseDoc-Mrs.K 2 жыл бұрын

When you calculate mortgage does it include home owners insurance etc or is it just the principal and interest?

@michaelstrange8807 3 жыл бұрын

Is that just the mortgage payment or do you have to figure taxes and insurance into it?

@bella2432 Жыл бұрын

Superrr Helpful and easy to understand!!! When applying for a loan as a married couple and making $50K. Can I make my numbers based on a Gross income of $100K so that our DTI is lower and the number we can afford higher to show the bank?

@NicoleNark Жыл бұрын

If you will both be on the loan, the incomes and debts of each of you will be added into the DTI calculation

@teddyfromtexas3945 2 жыл бұрын

Does using a credit card for all monthly expenses but paying off that card every month without interest hurt your back end debt to income ratio?

@loopba Жыл бұрын

14.6%

@derekshih5354 Жыл бұрын

Thanks for the video! It was very helpful. Does co-signing for an apartment lease count towards “debt” in the DTI?

@NicoleNark Жыл бұрын

Not usually!

@joegowac4578 3 жыл бұрын

Hi. I had several credit cards that I have paid off and now have a zero balance. I have left the accounts open to help with my credit score but it now appears that those would also be factored into my DTI even though they are paid off? So do you recommend me closing them out and watching my credit score drop or Leaving them open and effecting my DTI?

@AO-bz6zc Жыл бұрын

Does the property tax and home owner's insurance go in the calculation of the DTI too or is it just principle + interest along with car payments..etc?

@Gurchahal123 2 жыл бұрын

Alright ! i"ve been getting ur approach but , there "re something you missed up while DEBT ratio that's about property tax, utility bills may be those will effect on DEBT RATIO

@Clorice513 2 жыл бұрын

If you have student loans that are in forbearance are they used to calculate your DTI?

@cryptojuan5897 Жыл бұрын

Can I include monthly avg rent from other properties?

@scarface11385 2 жыл бұрын

Do they count food and phone bill and internet bill ?

@RetrieverTrainingAlone 2 жыл бұрын

Any suggestions for retired folks that have a history of frugal income despite net worth in the millions including real estate owned? By being frugal, low income tax bracket, but unacceptable debt/income ratio due to low income history in retirement, therefore difficult to prequalify for a loan.

@melissadelvechio1387 2 жыл бұрын

What if you get something in collections?

@jorgevargas1010 2 жыл бұрын

Thank you so much for this video! Quick question. How come we use the gross income and not the net? Isnt the net the actual money you have ( after taxes ) ?

@NicoleNark 2 жыл бұрын

Good question Jorge! It is the job of the lender to sell you a loan. They do not necessarily care how practical your payment is after you close on the loan. So lenders will use your gross income when calculating how much you can afford. It is your job to make sure that you have enough take home pay to feel comfortable with those payments!

@vwj8785 3 жыл бұрын

I'm trying to calculations but I just don't get it. I can understand yours and how you explain everything is so simple but I just can't figure mines out...