Mortgage: How Much Can I Borrow?

Lenders calculate how much you can borrow for a mortgage loan by comparing two “debt to income” figures which they determine from your application. These figures are called the front and back end ratios. A front end ratio is an estimate of how much you will be able to put towards your monthly payments. This is calculated by taking your annual salary and multiplying it by .28 and then dividing it by twelve. Ideally, your monthly payments should not be greater than 28% of your total monthly sala