Can the borrower pay off outstanding debt in order to meet the total debt-to-income ratio?
Installment debt can be paid in full. Provide documentation in the application package to verify the source of the funds that will be used to pay the loan in full. Prepayment of installment payments to less than 10 months is not acceptable. In general, revolving debt cannot be paid in full. Exceptions may be made depending on the number of revolving debts and the outstanding balance.
