DTI
Drilling Tools International Corp.
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My Watchlist for this week (15/04) NFA
I’m being too conservative and am looking for some advice to accept more risk.
DTI - Drilling Tools Intl. is anyone watching? It is creeping up on low volume.
Resumption of student loans has to have some impact. Right?
Resumption of student loans is going to have to have a negative impact (maybe)
Debt to Income ratio for homebuyers (DTI) hits all time high in 2023
PBTS Needs Some Recognition as they Operate in the Artificial Intelligence Space as well as the Metaverse and other Fintech sectors.
PBTS Needs Some Recognition as they Operate in the Artificial Intelligence Space as well as the Metaverse, Crypto and other Fintech sectors.
Mentions
Holy shit bro agreed to take out a 40k loan with Proser at 23% got all the way to terms and accepted and then they deny me. Credit score over 800 and DTI isn’t that bad. Just give me more money to buy the dip retards.
The truck to doing this to decide which fundamentals matter to you (PEG, TTM P/E, DTI, P/S, etc) and then go back in time and test them against companies like AOL and Cisco. You can't blindly say "buying individual stocks sometimes doesn't work out" because each one is unique, both in business fundamentals and leadership but also macroeconomics and political environment.
*I will be renaming AI, to DTI. Thank you for your attention to this matter.*
My boy just got a $100k home equity loan on top of his $200k mortgage making $60k a year. DTI over 60%. All done in less than a week. The fucking top is in.
Yes, but we still have legally protected classes that need to be shielded from discrimination. Like age, race, etc. For instance, mortgage lenders can't discriminate based on age. Someone who is 90 can get a 30-year mortgage, and they aren't able to deny them based on the fact that they will likely die soon. Theoretically, a 90 year old with zero savings, but with social security income could take out a 50% DTI mortgage and then die the next day. Legally the lenders aren't allowed to take that into consideration: they have to assume that the income will continue indefinitely. However, with the inclusion of "AI," then the Vantage 4.0 system could start giving lower scores to seniors when asked for a mortgage score. And that's because the "machine learning" and "neural networks" will likely deduce that older people are less likely to pay off their mortgages before death. But, since AI is a black box, there is no way for regulators to check if illegal logic like that is being used. All the company can say is that they fed all of the mortgager's data into the black box algorithm, and the algorithm told them that the senior had a low credit score for mortgages. The algorithm might also "notice" during training that borrowers with the first name "Ayanna" tend to default more than borrowers with the first name "John." But it is impossible to know exactly what a neural network has deduced from its training data set, so again there is no way for external regulators to actually see if the AI score is factoring in such things or not. See the problem here?
Approve that fucking loan RIGHT MEOW! DTI doesn’t mean a fucking thing tbh. 2008 all over again!
Here’s your answer: it depends, but I’ll tell you what I would do if it won’t affect X factors. See below. Basic info in case you don’t know how the mortgage side works, the heloc inquiry might drop your score a few points but probably not more than about 3 to 5 points. Mortgage rates are based on a matrix with multiple boxes that determine your LLPAs (Loan Level Price Adjustments) that get added to your base rate as well as the base rate itself. The boxes you will be concerned about are: LTV (loan to value), FICO score, and DTI (debt to income). Ltv has price adjustments every 5%, Fico every 20 points, DTI is program specific and isn’t always a factor - sometimes it’s just qualify/not qualified. Example, let’s say you are currently at 76% ltv, with a 723 fico, and a 49% DTI. In this scenario, you would actually want to put a little bit more down because the 75% ltv break point would benefit you. Your credit report is good for 120 days, so the pull won’t affect your score unless they had to repull your OG score because it expires while you wait for your heloc to fund (fast ones about 8 days, slow ones about 35). Don’t be rate sensitive on the heloc - it’s short term money. DO be cost sensitive since it’s short term. So you’re looking for near zero cost and don’t worry about the rate even if it’s 1 to 2% higher. Also, make sure there is no early close penalty if you are planning to pay it off in the next X days. Lastly, on this point, if you are working with a broker, tell them your plan. They have something called an EPO where THEY have to pay for the costs on your loan if you pay it off too quickly. If it’s a bank loan officer, don’t worry. That cost is built in or they’ll cover it with an early fee to you. Lastly, the underwriter on your new 1st mortgage will want to add any monthly payment required from the margin loan. Make sure that added payment doesn’t push your DTI up over a the max DTI allowed for your loan from both the Heloc loan or the margin loan. Based on all of these factors, you should be able to figure out which trigger to pull. At least, it will if I explained myself clearly. Personally, I would do the margin loan for the simplicity, and your only risk is if the market massively tanks before your home sells. Hope this helps.
Fortunately we don't have a lot of debt. I live in Massachusetts but not in Boston. Our mortgage is our largest bill and our combined (after tax and deductions) DTI is somewhere in the mid 30% range I'm guessing. Haven't specifically calculated that in a bit. I'm making more money now than when we bought our house
Where do you live and how much is your DTI?
Pay off a 9k truck note and 17k in student loans (3-4%). You Debt to Incmce ratio, DTI, will improve and this ratio impacts getting more credit. The preferred ratio is 36% or less, pay off a 9k truck note and 17k in student loans (3-4%) {Total monthly debt payments}/ gross monthly income = DTi ratio See if you can refinance the mortgage 6.4% rate for a lower rate.
FWIW, I handle 90% of all the financing that happens at my dealership. Banks are tightening up on lending, especially people w high DTI’s despite high credit scores. In the past, if someone had a 740+ FICO and long credit history, PTI and DTI was thrown out the window. But this may have absolutely nothing to do with your post, just some info from my world.
No, people were not buying houses just working at McDonalds. Yes it was cheaper, but you still had to have a down payment saved and meet some pretty strict DTI requirements. Student loans count in that, too. The issue millennials have is entering the job market during a recession, having large student loans, rents rising as you start to make money and more. If you were able to save and/or land a high paying job, you’re probably okay, but it’s not great for the rest of them. It’s very much like our economy of the last few years- if you had money to invest, you’re doing okay. If you don’t, you’re very much stuck.
You really had to use ChatGPT to answer something you didn’t know? We already know it gives false answers and isn’t accurate. In banking we use something called the DTI ratio. Debt to income ratio. In these calculations we don’t include any debts that are going to be paid in full. If you have a $50,000 car loan, your monthly obligation for that loan would be used to calculate DTI. It’s the same for a credit card balance.
I think it’s definitely part of the problem. There’s also corporate acquisition of housing. And as far as generations, we should be on course for a population decline, but immigration has been propping up population numbers big time. In fact, Millennials are comprised of more foreign born people than any other generation (for example, Boomers are almost exclusively American born). I think we have to address multiple issues if we want healthy housing for Americans: -de-incentivize Airbnb and corporate ownership or gamification of single family homes. -drastically lower immigration into the US (for many reasons). If you removed immigrants and children born to immigrants from the stats, Millennials are suddenly not as big of a group. We have to take care of native born Americans and provide them with homes before helping foreign born people. -address the issues around American debt culture; it’s obvious that people struggle to control themselves when credit and loans are available. And if you look at the DTI of mortgages underwritten since the housing price boom, and you look at average house prices vs average HHI in many areas, it’s obvious that many people have over leveraged themselves to afford a house. Since we can’t fix people’s willingness to commit financial suicide, we have to go after the banks and mortgage companies who are propagating this, along with complicit realtors, appraisers and companies like Zillow that engaged or furthered price manipulation. I mean, there are talks of 50 year mortgages, and we don’t want to be like Switzerland or Germany or Hong Kong where less than half of the population actually owns a home.
Msft calls were ez money. Now DTI 🚀
Guarenteed Back-up Contract. Essentially you pay a company a small fee to buy your house at X% after X months (this case it was 6), then the underwriter can deduct that much from your DTI to free you up to look for other houses and buy them. You cannot get out of the GBC. A small benefit if it ever gets to that point is they will give you the profits after they cover operating costs when they sell it, but who knows what amount that will be. It will rarely get to that point though.
I disagree. Thinking that all people are rational and all of them are fixed in place is a mistake. I’ve known people who bought houses and changed their mind and took a bath to move down the road. Lots of people sell for a myriad of reasons from new job in a new state to change of scenery. Some of these moves are unavoidable, and some are not financially wise but are done nonetheless in the same way people take out $100k loans for college to get a useless degree or klarna their groceries. That irrationality is directly in line with the fact that many people who bought during the most recent surge did so at their own detriment as shown by the increase in DTI with some people getting FHA loans over 50% backend DTI. The number of people who are house poor is staggering, and the rational thing to do (if we were all rational) would have been not to bid up and up and up forcing others to then do the same. The reality is the now second largest demographic (and the demographic most likely to own more than one home) is dying off and there will be many houses for sale in the next 10 years because of it. On top of this, there are builders trying to meet demand in many areas of the south. The population of America is projected to shrink from 2025-2030 and that includes with immigration, a quarter of which is estimated to be illegals. There will be a surplus of inventory, all projections point to it. It’s just going to take a decade or so.
My friend, people spend 20 years learning how to do this well. It’s wildly more complex than you can imagine with hundreds of data points to consider. Anyone who wants to securitize a large dollar amount of auto loans usually has to have their loan data (Credit Score, DTI, LTV, PTI Collateral Info etc), loan policy/procedures and at least 5 years of past loan performance analyzed by a ratings agency (think Moody’s/S&P). It’s a months long process and typical size of pools is $500m+. You don’t even know the basic vocabulary and don’t have the 10s of millions of dollars to even buy one small piece of this stuff (let alone to try and short it). Reddit isnt the place for this. You want to gamble? Go short Carvana, it’s much easier.
The Fed is ending Quantitative Tightening (QT). · The U.S. dollar (USD) has dropped 12%. · There has been a 4% increase in U.S. dollar printing (money supply). · The U.S. national debt has crossed $38 trillion. · The U.S. debt-to-GDP ratio is at 119.4%. · The U.S. Debt-to-Income (DTI) ratio is high. · Inflation is up 3%. · Credit card debt is at a record high. · Medical debt has been reinstated on credit reports. · 40 million Americans are at risk of losing SNAP (food stamp) benefits. · There are 500,000 more sellers than home buyers. · Housing affordability is 25% higher (worse) than in 2007. · Home prices have posted the weakest gain in 2 years. · There are significant WARN layoff notices. · There are substantial job losses due to AI integration. · Major layoff announcements from companies like Amazon (14,000), UPS (48,000), Paramount (2,000), and GM (1,700+) in late October 2025. · Various countries have stopped shipping to the USA. · The U.S. has implemented new tariffs. · There has been a reversal of the de minimis exemption. · Global dedollarization efforts are underway. · The top 10 stocks make up ~41% of the S&P 500 (a sign of a potential bubble). · The odds of a recession are at 93% (from a UBS model). 67% of Americans surveyed live paycheck to paycheck Freight volumes are down 17% This is Fine. /s
no? a lot of adult women I know opened a roblox account bc of DTI and they still play it. same with my 10 years old cousins xD they are obsessed with it.
I don't think you know how the buying process works then. A bank will not give you money for a loan if you do not have the income. They will not give you a loan if your DTI is too high. If the price fall low enough and home owners do not buy it immediately investors will. The market was not the same when we bought... Homes were selling 45% of the time in 1 weeks. A month ago it was 4-6 week, now it's 6-8 week. Something is happening to the general populations purchase power.
Although LTV and DTI ratios are a bit higher, default rates are still historically low.
1. Pay off all credit cards 2. Pay off most/all personal loans 3. Invest 4. Take investment profits to pay debt obligations 5. Repeat 3 and 4 until +/-25% DTI 6. Try to figure it out yourself or contact a professional/forums once you’re there and got some experience.
>How can you believe the housing problem is not primarily caused by mortgages which cost > 50% of household income? The housing problem is *not* primarily caused by mortgages and the vast majority of mortgage loans rebuked a DTI of >43%. That’s mortgage payment and all other credit debts combined. If mortgage interest rates decrease, home values increase at a faster rate. The second half of 2020 and part of 2021 were solid examples of that. Another way to look at it is the monthly mortgage payment someone is approved for remains the same regardless of interest rates. The total loan amount changes based on the interest rate and housing prices increase because of that additional amount borrowers can finance. >Meanwhile people like you go around saying “raise the rates,” because you dont like the president. congratulations buddy your rhetoric causes average americans to suffer but hey at least you stuck it to the president that’ll really show him A random person in the comments on a Reddit post does not have anywhere near the power and authority necessary for your statement to be true. You need to consider taking a break from the internet.
I thought everyone here had good DTI and a good credit score? 😂
Currently make 100k a year. 11 percent to my 401k, has about 106k in it. Roth IRA maxed yearly. HYSA has 70k for emergency fund. 15k in the sp500 DCA biweekly. I have a home, mortgage is 1650. My DTI ratio is very very solid. Thank you for the insight!
[https://better.com/b/rates-purchase](https://better.com/b/rates-purchase) Even with a possible 1-2% increase for rental vs primary residence, 12.75 means either your lender is screwing you or your credit/DTI is horrible, and you don't qualify for the best rates.
I just ran this entire scenario through ChatGPT and it said based on my income and debt, my “basic affordability stress test” was at 33-40% and my front-end DTI test and back end DTI test (never heard of these before) were both around 30%. According to GPT, this is acceptable for a loan of this size although 40% is borderline risky. Luckily my sister was paying me rent and my wedding business continued to grow and required less cost of goods. I did get fired from my retail job not too long after buying the house but the mortgage was secured at that point and everything worked out.
DTI regs are pretty tight.
We wanted to get a $10k personal loan for some home improvements and shopped around 8 months ago and got attractive rates but weren't ready. Score went up +15 to 765, no change in DTI -- getting all sorts of random denials on pre-qual this week for same amount/same terms.
Mortgage lenders don’t count a Student loan the same way they count an auto loan in your DTI. It counts for less, I believe half but I could be wrong on the amount
How would your debt to income fall from your ARM increasing? If you apply for a refinance, that ARM isn’t included in your DTI since it will be paid off at closing.
3.25% for me. Bought at the start of the recovery in 2013 at the young age of 30 and haven't sold. I'm 42 now and still enjoying that 3.25% rate. I tried to refinance to a 2.65% rate during the COVID years, but my student loans got in my way as they heavily skewed my DTI.
hahahahaha.... "soft landing." "kicking the can down the road." to-may-to, to-mah-to. The warning signs have been there. I listed them off. Or are you going to say things like PE, DTI, yield curves aren't a strong indicators that most investors reference?? clown.
You mean the recession that was predicted since mid-2024? In the first term of a new administration? While PE and DTI ratios were near all-time highs?? Shocking!!! "But, but, but he's orange or something like that!" Cool story. More than 40% of my portfolio has been moved to cash or equivalents in the past year or so. Expected outcome was expected.
HUD publishes reports, last report was nov 2024 it was at a 14% default rate, however in same report can see that in 2022, 17% were already in default, this was lowered due to a FHA home modification program (covid 19 advance loan modification) to buy down points and tack on fees and late payments to end of loan to then make the monthly payment less expensive. That means in less than 3 years we have people defaulting on these loans that they already couldn't afford after a modification to the loan. Meanwhile DTI continues to rise for these same borrowers exceeding 50% of their gross income. Its not sustainable and its just being kept artificially low. It's more likely the actual number is closer to a 20% default rate. Have to keep in mind FHA homes are mostly in lower income areas, these people are already struggling with gov assistance. In the same markets commercial is also taking a pretty big hit.
DTI Puts since i heard their tools really work
Calls on Drilling Tools International (DTI)
I’m good, my DTI is .5 But there are millions of Americans who don’t have the liquidity that I and others do. People cashing in 401k’s when they lose their job during a crash is literally how some people don’t lose everything.
Household DTI is lower than before the pandemic https://fred.stlouisfed.org/series/TDSP
Kind of my fear, I’ve just started my career so my hope is I’ll advance at a decent pace and drop my DTI under 35% which I’ve been told is a good area to be at.
I’m just saying, if you can get an fha or conventional with 5% down, and you can pull less from investments, what does that make your payment look like? Take 20k instead of 80k leaving the other 60 invested, does it let your DTI meet where you need to be but not strain you cash flow wise every month? Might be the best of both, and still have some equity in it long term, or especially considering if you for some updating, maybe you use the other 60 for that for the next year strategic, get a new appraisal and add some value, and refi out of something that might have PMI attached to it also. Maybe get some or all of your money back. Hard to say, don’t know condition, comps, what kind of value add it may be, etc to try and see if some of this makes sense for you or not.
Spy should dip in a few days try your luck with a 1 DTI SPY put? And send me 10$ :P
Hi, about lumber tariffs. . . When Trump was in office prior, he rolled the tariff on Canadian Lumber. Later Biden increased this tariff, remember when limber (Random Board Length) went parabolic? The National Association of Home Builders said that new home builds increased by 36K on average. In August of this year, Biden nearly doubled the tariff on Canadian Lumber. I predict that this tariff will be dialed back by Trump again. When it comes to labor, I wouldn't think there would be a shortage. Most contractors in the panhandle of FL employ authorized immigrants through sponsorship and/or work programs. Or at least they claim they do. However if there were a shortages of immigrant labor, returning to citizen labor could impact margins for sure. Personally, I think affordability challenges is a great headwind to home builders when it comes to owner occupants. Latest report I saw, most Americans are living pay check to pay check so meeting DTI requirements for mortgages are difficult and the high interest rates are still leaving a bad taste in their mouths. I could see some builders such as DR Horton building more rental income communities and selling the subdivisions to pension and hedge funds.
All in on SPY 0 DTI Calls
I got approved at 58% DTI 🤣🤣🤣🤣 i didnt buy anything though its just too crazy expensive in my area. Looking to move out of state
I just bought a house at 62% DTI…just doing my part 🌈 🐻
DTI has been near 49.99% since 2017. What’s new? Fucking gaslight
I’m sorry you think the people taking mortgages at 50% DTI are paying their mortgage first???
Thought DTI for a home loan was in the 40% range and VA backed loans up to 50% or a little higher.
I see there’s already over 1k comments, but I wanted to share my story: I have a fairly high DTI ratio and the mortgage will be half of my salary. However, the mortgage is only in my name and doesn’t account for my husband’s income which would but housing ratio much closer to 15-20%. Only adding because what you see may not be the whole story.
The reason the VA has such a low default rate (lower than conventional and FHA) is because of the VA Residual Income requirement which is similar in nature to a DTI limit. Either way, the specific buyer I'm referring to with a DTI of 78% had much more income but wasn't able to be included in his usable income for the loan. He was receiving rental income of $3,600/month but we weren't able to use that income. With that income, the borrower's DTI would have been in the 40's while owning two homes, both of which were with a VA mortgage. I would not be able to sleep at night knowing that I put someone in a position to lose their home. ATR= Ability To Repay! -Mortgage Mike
As someone else said these guidelines are not new. And you are able to push the DTI higher if they have good reserves and a high residual.
Yep. I closed one with 75% DTI. Reserves out the wazoo another property owned free and clear that they were selling. I need two underwriting signatures but it closed.
I’m in lending. I’m far more concerned with the credit card and auto loan payments that I see than the house ratios at the moment. I think it boils down to entitlement, education in the family and the ‘show me’ mentality on line. People have a ‘I must have it now’ mentality. Ex I had a client this week who worked at Amazon making $2k a month, but had an $1100 car payment plus student loans and credit cards. I tried to explain how debt to income works and that I wouldn’t be able to offer her a home loan - she explained that she got the car bc her other one broke down that day. I thought perhaps if she had saved that monthly payment of $1100 for a few months…carpooled/ubered and then paid cash for a car…and she had $100k+ in student loans and she’s packing boxes at Amazon making $24k a year. I had one client max out their DTI. They desperately wanted to buy in this certain neighborhood, have the MB and use this certain Realtor (who charged more than others) bc she gives out LV scarves at closing and post about it. I can’t make this shit up. I see lots of folks making smart decisions in order to get Into homes…moving to lower cost areas…saving for a down payment or buying a fixer upper. It’s these people who DO want to push their ratios (and they usually have someone pushing them who have something to gain from it in this type of scenario) and using down payment assistance, who also have the $1k car payments and maxed out credit cards who REALLY worry me. I SEE these folks selling year after year for very close to break even or less and then going back to rentals. Then they’ll call me a year or so later and say / I’m ready to try again! But they’ve made a few late payments and their score has tanked, added child support or more college debt, bc adding a master’s degree will surely (make family proud, give them clout, elevate their promotional opportunities- pick one…)- I literally see this scenario play out monthly. I’ve been doing this since 1999. I can spot it all a mile away. Bottom line - market won’t crash like ‘08. Different circumstances. Very hard to get loans now compared to <‘08 and much fewer houses. Find a mentor - someone REAL…not an IG ‘pay for me mentor.’ And have that person tell you how to fix credit and save $$ and help you Into a home and learn a side hustle. 🙏
I have 2 VA loans at almost 60% DTI, oh how I desperately want out. 😿
I didn’t really wanna get into the weeds on residual income on a random Reddit post, we used to have a company overlay for 60% DTI but yeah to be specific on VA it’s residual income
Yeah I was gonna say, when I worked in mortgages for a couple years in 2016-2018 it was 50% DTI
Why? Why do you need delinquencies to spoke for housing prices (the housing price aka perceives value and wealth effect bubble) to exist? What we're talking about here is a crash in home prices...foreclosures like in 2008 are one way for that to happen. Another is just for a massive buyer's strike on homes to drive a sharp increase in inventory that isn't moving and thus a huge reset on housing prices. That's what's going on now. And when that happens all of these marginal buyers that bought at the top in 2022 or maxed everything with 5 percent down or bought at huge DTI levels as described by OP are gonna get wiped out.
Wow. 😳 I had no idea that this was a thing. This is not sustainable. One bump in the road and these people are going to be screwed. Can’t imagine what they are thinking… just because they allow you to borrow it doesn’t mean you should. Common sense. One layoff away from disaster. Maximum should be 30% of your income for the payment including your property tax and insurance with 36 DTI. It’s simple math. Why would anyone do this to themselves? Scary. Remember the Great Recession? 😳
Wow. 😳 I had no idea that this was a thing. This is not sustainable. One bump in the road and these people are going to be screwed. Can’t imagine what they are thinking… just because they allow you to borrow it doesn’t mean you should. Common sense. One layoff away from disaster. Maximum should be 30% of your income for the payment including your property tax and insurance with 36 DTI. It’s simple math. Why would anyone do this to themselves? Scary. Remember the Great Recession? 😳
49% dti on conventional and you can get them approved over 50, VA loans have no DTI limit. 30 has not been any standard in a long time.
lol 50 DTI is nothing. The no income loans have been a massive demand over the past several years. People with 40-50k still getting approved for 800-1M houses. The only difference between today and 2007 is that they require 20% down and decent credit whereas back in the day that didn’t matter. Not still no income verification.
DTI is just one parameter. It's possible those clients have a large enough stock portfolio or other assets that can be used as collateral.
Correct me if I’m wrong. I view this as a gamble on the big lenders side. If mortgage rates drop say 2% in the next couple years, people will refinance, putting them into a much healthier DTI ratio. Plus the knowledge that the government will inevitably come to the rescue when foreclosures start to become an issue, probably by lowering rates. That said, I don’t know shit. That just my big general uneducated thought as to why lenders would create such risky loans.
50 DTI isn’t new. OP is full of it. They clearly have no experience.
I’m talking about 50% housing ratio and 60% DTI. Which was not common at all until interest rates rose. From what I’ve been seeing, virtually every first time home buyer who’s purchased in the last 2 years has a loan that’s risky AF and unaffordable. The smallest financial shock can cause people to struggle making their payment. Hence we’ve seen a 2,000% Increase in mortgage assistance requests. Which has been fine as we’ve had $$ to help pay people’s mortgages. That money is all spent up now…
If someone has good credit and the LTV is low, total DTI can exceed 50%. Often these approvals from Freddie / Fannie include appraisal waivers.
And here I thought my 4.5% DTI to my paid off house (property taxes a month) was too high lol.
He does know what he’s talking about. Just because it isn’t new doesn’t mean it isn’t risky. That’s complete insanity when you’re talking about millions of mortgages. I guess the higher interest rates help offset the risk. But when these rates come down, it is pure lunacy for a lender to keep lending at that DTI.
VA Loans do not have a DTI cap. 60% isn't written anywhere. I've closed a VA Loan woth a DTI at 78%.
You must be relatively new to your job, 50.49% is max DTI for conventional, 56.99% FHA, and virtually no limit on VA products. These have not changed for years, neither automated underwriting models nor typical lender overlays have changed drastically in many many years. It’s been fucked but as long as companies don’t vaporize and the streets are flooded with foreclosures it will probably be great. If you don’t like the sound of the average home price in America being $2.5MM ten years from now, you can just fuck right off.
You're confusing DTI and PTI.
44 and 50% DTI loans have been around for ages. If they qualify, people will keep making payments. They only foreclose if they lose their job and can’t make payments..
Mortgage Loan Officer here. 56.00% FHA backend & 47% front end (housing) DTI has BEEN the norm. You can go up to 49.99% on Conventional and still go approve/eligible on decent credit. Not disagreeing but NOTHING like 2008.
FHA has a max ratio of 47% front end 57% back end. Meaning 47% of your monthly income can be your house payment. No more 57% of your monthly income towards all debts house payment, car payments, credit cards etc… however to qualify at max ratios you would also need to be well qualified with one or more of the following. months of reserves in cash, a downpayment of more then 3.5%, a high credit score. VA actually has no max DTI ratio but the veteran must meet residual income requirements. In short It’s not as easy to get a loan at ratios as they make it sound above.
He's completely full of shit. He claims Fannie/Freddi relaxed agency mortgage DTI ratios, when in reality it's been the same 50% of DTI for over a decade. [https://www.remnwholesale.com/wp-content/uploads/2015/01/Fannie-Mae-Freddie-Quick-Reference-1-16-15-3.pdf](https://www.remnwholesale.com/wp-content/uploads/2015/01/Fannie-Mae-Freddie-Quick-Reference-1-16-15-3.pdf) [https://selling-guide.fanniemae.com/sel/b3-6-02/debt-income-ratios](https://selling-guide.fanniemae.com/sel/b3-6-02/debt-income-ratios)
1. Agency mortgages has had the same exact 50% DTI maximum since at least 2015. [https://www.remnwholesale.com/wp-content/uploads/2015/01/Fannie-Mae-Freddie-Quick-Reference-1-16-15-3.pdf](https://www.remnwholesale.com/wp-content/uploads/2015/01/Fannie-Mae-Freddie-Quick-Reference-1-16-15-3.pdf) 2. These loans are completely affordable for the people getting them. The people who are buying with a mortgage today really want a house, and so they make sacrifices in other expenses to make it happen. Just because you have different spending priorities than them does not mean it's unaffordable. 2008 was a completely different paradigm. Borrowers were getting introductory 0% APR mortgages and negative amortization mortgages to lower their initial payment, with the thought they would just sell the house at a profit later. This is absolutely not happening today.
This guy is probably terrible at his job, if you work in the industry you know it’s been 50 DTI for over a decade.
This is really useful insight. Thanks for sharing my man. I wonder what their end game is? It’s well known the loans above 44% DTI are no bueno. Will they ride it down to a recession? Are purposely looking to break the ecónomo fix it? Or is it to allow rich vultures to feast on the dead bodies after all is said and done.
Can confirm, I got approved for a 60% DTI on a house.
Yeah this isn’t a relaxation of DTI requirements I think what OP is seeing is higher housing prices demanding people to push the limit of what they qualify for in order to purchase a home that meets their needs.
Student loans in deferment only get hit for like 0.5 to 1% of the balance towards DTI
It’s not just with rocket mortgage, that’s standard FHA DTI requirement, VA loans go up to 60%, neither requirements are new either
I’ve been in the industry since 2013 and I don’t ever remember 30% front end ratio being a requirement, it was always max total DTI of below 45%-50% depending on multiple factors but I don’t think anything has really changed with conventional loan DTI reqs in the ten years I’ve been around it.
If they are getting approved for a conventional loan with a higher DTI, they are putting down a larger down payment, so there's a lower LTV and more options to avoid default down the road.
You are a housing counselor and you think a 50% DTI is something new? 30% is a recommendation. Most first time home buyers have been maxed out at 50% since before 08. FHA allows a 56% DTI on the back end.
Not saying you might have witnessed it- Maybe you even did it. They have been approving loans up to 50% DTI since the housing crisis. It’s not something new, where has the crisis been the last 15 years?
Simply not true. Max back end DTI is 50%. Fannie/ Freddie call a “QM” mortgage anything up to 35%/43% but have allowed for DTI’s up to 50% for a long time.
50% DTI is nothing new. Been that way for decades.
This seems to be probably a company issue at your employer, not the main stream. The DTI ratio for conventional mortgages is up to 50%. The housing ratio over 45%-50% front end ratio is uncommon and usually required experienced staff to approve or deny these with certain parameters around them being approved. The good news is that probably 50% of the US is locked in at rates at 4% or below. I don’t see there being a house crisis where we are seeing defaulting mortgages, I see an issue when people may want to upgrade their homes but see a 50-60% increase in their payments and they choose to sit on the sidelines. Also Taxes and Insurance are going up so some of those 45-50% DTI approvals might be closer to 55% if they are on fixed income. Costs have increased but wages have not. Like many others have said, you will not see anything closing to 2008 .
I am not saying it’s a great scenario but max DTI on FNMA has been at 50% since before I started and that was in 2011. 🤷♀️
No lender or loan product cares about a 30% "housing ratio". They ONLY care about DTI. So, if your only debt is your mortgage, you can push this ficticous 30% housing ratio to the full DTI %. And yes, some loans and circumstances will allow for a 50% dti. Most don't. But some will. Hardly proof of a housing bubble.