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How are lenders adjusting DTI requirements for high-tax/insurance states?
With property taxes and homeowners insurance skyrocketing in states like Texas, Florida, and California, the traditional Debt-to-Income (DTI) ratio is becoming a bigger hurdle for buyers.
A buyer might qualify for a $400k loan based on P&I alone, but when you add the new insurance premiums and reassessed taxes, their DTI jumps above 43%.
Are lenders adjusting their underwriting models to account for these regional cost variations? Or are they simply denying loans that used to be approved two years ago?
I’d love to hear how professionals are handling this in their day-to-day business.
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