David and Mary smith together earn $54,000 per year, David and Mary would like to buy a home for $200,000. They have one child. The new mortgage is $160,000 at 6 1/4 for 30 years for $985.15 per month. Annual property taxes are $1,800 and insurance on the home will cost $600 per year. They have enough cash for the down payment and closing costs. Total consumer debt payments are $650 per month. > >
A) what is the maximum percentage of monthly mortgage payment to total monthly income required for conventional mortgage loan qualifications?
B) what is the maximum percentage of the mortgage payment plus total consumer debt obligations allowed per month to qualify for conventional home mortgage?
C) do they meet the two ratio requirements to obtain conventional home mortgage financing approval?