Calculators: CB Financial, Residential and Commercial Loans

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Mortgage Loan Calculator

Mortgage Qualifier

Housing and Debt-to-Income Ratios

Potential Tax Savings Worksheet

Effective Tax Rate Calculator

Debt Consolidation Worksheet

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Housing Ratio and Debt-to-Income Ratio

One of the many things a lender considers during the loan approval process is your debt to income ratio. It's a simple way of showing what percentage of your income is available for a mortgage payment after all other obligations are met.

The maximum percentage of your monthly gross income that the lender allows for housing expenses. The total includes payments on the loan principal and interest, private mortgage insurance, hazard insurance, property taxes, and homeowner's association dues. (Often referred to by the acronym PITI.)

The maximum percentage of your monthly gross income that the lender allows for housing expenses plus recurring debt, which includes credit card payments, child support, car loans, and other obligations that will not be paid off within a relatively short period of time (6-10 months).

Step 1::
Calculate Your Housing Ratio

the "housing ratio" is calculated by dividing monthly housing expenses by your gross monthly income. The housing ratio should not exceed 28%.
monthly housing expenses includes real estate taxes, insurance, etc. If you don't have your real estate tax or insurance figures, the American Housing Survey shows that the median taxes paid averaged $12 per $1,000 in home value (divided by 12 months). The property insurance paid averaged $30 per month.

You may contact your local community and county officials to determine your true county and city tax factor:

You can lookup your property tax assessments by community:
http://www.statelocalgov.net

Private Mortgage Insurance (PMI) will be required if your down payment is less than 20% of the home purchase price. Your PMI monthly cost will average 0.005 of the borrowed amount divided by 12.
if you fail to pass either ratio, you may need to adjust your loan request to bring your ratios within approved parameter

Enter the estimated monthly mortgage payment or loan parameters below:

Mortgage loan amount:
Number of months to repay:
Home mortgage loan rate (APR):	%

Estimated Taxes per Month (annual assessment divided by 12):

Estimated Insurance per Month (annual premium divided by 12):

Estimated Other Expenses per Month:

Total Monthly Income:

Housing Ratio (should be around 28% or less):

Step 2:: Calculate Your Debt-to-Income Ratio calculated by dividing your fixed monthly debt expenses by your gross monthly income. As a basic rule, the debt ratio should not exceed 36%.
Estimated Total Housing Expense (from above):
Total Monthly Installment Loan Payments (auto, student, other):
Total Monthly Credit Line Payments (credit cards, credit lines):
Monthly R. Estate Non-Income Loan Payments:
Monthly Alimony and Child Support Payments:
Monthly Tax and Legal Assessments:
Monthly Other Payments:

Total Monthly Income (from above):

Debt-to-Income Ratio (should be around 36% or less):	%

* Calculations are based upon the assumptions you entered. Please note that rounding errors can make a small difference in calculations. The circumstances surrounding your credit and loan qualifications may result in different calculations. You need to consult your tax advisor for the applicability of tax savings.

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CB Financial Services
3406 Hall Lane, Lafayette, CA 94549
925-284-0800 email: info@cbfinancial.com
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