Mortgage Dictionary
A guide to mortgage and real estate terminology
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New Definitions |
| Front Ratio |
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Total monthly housing expenses divided by income. |
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Additional comments :
Lenders use a front ratio as a guideline for qualifying an individual for a loan. Acceptable front ratios vary depending on the lender. To calculate the total monthly housing costs for a single family home, add the loan's principal and interest, property taxes, and property insurance. For condominiums, cooperatives and PUDs, also add the cost of Home Owners' Association dues. Then divide the total by gross monthly income.
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