All Forum Posts by: Andre Chouinard

 Depends on the bank and their possible overlays - got it. Thank you for the help.

Just to be clear; If I have a zero balance will the underwriter calculate my payment for $65,000 drawn and the maximum interest rate? 

I am pursuing a HELOC of $65,000 on my owner-occupied duplex and was wondering how this will affect my DTI ratio when applying for future mortgages.

For normal consumer credit cards, the lender adds up the minimum payments and adds it to the debt portion of the DTI ratio. For my pending HELOC, what amount will future lenders include in their calculation of my DTI when applying for mortgages on different properties?

For example, if I have a zero balance on the HELOC, how do they estimate my payments and factor that into the ratio? If I do have a balance, will they use my current interest payments as my debt obligation or will they pretend the interest rate is maxed out?

Any (detailed) information that people have to clear this up for me would be appreciated, thank you for your time.  

 Thanks Shaun, this was very helpful

Thank You for your response, do you know if they will take 70% of the income I get from the fully rented unit or 70% from my total rental income (including spare bedrooms)? I have heard elsewhere that "spare bedroom" rent is not included in DTI even if I have leases.

Hi everyone,

I have been owner occupying a duplex (renting out one full unit plus spare bedrooms) in Dover, NH since 2016, get rents totally $3440 monthly, seen great appreciation on the property value, and want to open a HELOC secured with the property.

The complication I am dealing with involves my debt to income ratio and how it is calculated. I can not seem to find any solid guidelines on how I should make the calculation accurately given my situation. For example, it is my understanding that my mortgage taxes and insurance go into the numerator of my DTI ratio; In my case this totally dominates the numerator as I do not have any other significant debts. The complication now comes with calculating the denominator, my income. I have good w-2 employment- that's easy- what about my rental income? Can I include my total gross rental income? Gross from the fully rented unit? Total gross minus expenses? What expenses?

My primary expense is mortgage taxes and insurance, Since that is added to my numerator (debt) wouldn’t it be foolish for it to subtract from my denominator (rental income) as well?

If anyone can help me straighten out this calculation it would be greatly appreciated. I have a good understanding of the rest of the process and don't have any problems with the collateral portion of the loan, but I am concerned that my DTI could give me problems depending on how much rental income the will count/ what expenses they add to my debt or subtract from my income. Thanks for the help!

Hi everyone,

I have been owner occupying a duplex (renting out one full unit plus spare bedrooms) in Dover since 2016, get rents totally $3440 monthly, seen great appreciation on the property value, and want to open a HELOC secured with the property.

The complication I am dealing with involves my debt to income ratio and how it is calculated. I can not seem to find any solid guidelines on how I should make the calculation accurately given my situation. For example, it is my understanding that my mortgage taxes and insurance go into the numerator of my DTI ratio; In my case this totally dominates the numerator as I do not have any other significant debts. The complication now comes with calculating the denominator, my income. I have good w-2 employment- that's easy- what about my rental income? Can I include my total gross rental income? Gross from the fully rented unit? Total gross minus expenses? What expenses?

My primary expense is mortgage taxes and insurance, Since that is added to my numerator (debt) wouldn’t it be foolish for it to subtract from my denominator (rental income) as well? 

If anyone can help me straighten out this calculation or recommend any flexible lenders on the NH seacoast it would be greatly appreciated, thank you.