DTI calculation, for conventional lending

[Tim Joyce]

Can any lenders who do conventional lending tell me how wide a snapshot you’d take of my debt obligations when calculating DTI? Like, does the short-term debt service I have now really hamper my borrowing capability for the length of that loan? Here’s the reasoning - We have a 30 year mortgage on primary, law school student loans on 20 year plan, and two car loans on 6 or less. Even though the principal on the cars combined is less than my student loans by 2/3, the combined monthly payments are more than student loans. I’m wondering if I found an extra $10K this year to pay off a car and eliminate my monthly payment $200 or so (or $22K to pay off both cars for extra $450/month), what impact would that have on my ability to borrow on an investment property at 30 year conventional terms? Is there a predictable relationship between more available funds per month and increased borrowing ability? For example, could I assume that an extra $450/month makes me able to borrow roughly $60K more on a new 30 year investment property note?

[Chris Mason]

$250/mo in minimum payments on consumer debt works out to roughly & super ballpark $50k in purchasing power.