Is there a total DTI ratio limit on eligibility?
No. A high total DTI (back-end) ratio will not prohibit a borrower from getting a modification. However, as a condition of the modification, borrowers whose back-end ratio equals or exceeds 55 percent must agree to participate in a housing counseling program to help them create a sustainable financial plan. The back-end ratio is described in detail in Supplemental Directive 09-01. Generally, it is the ratio of the borrower’s total monthly debt payments (such as PITIA, mortgage insurance premiums, junior or secondary lien payments, and payments on other debts, i.e. credit cards, auto and student loans) to the borrower’s gross monthly income.
