Suppose you earn a gross income of $$ \$ 2,730 $$ per month and apply for a mortgage with a monthly PITI of $$ \$ 510.51 $$. You have other financial obligations totaling $$ \$ 431.34 $$ per month. (Use the ratio guidelines on page 468 .) What type of mortgage, if any, would you qualify for? Select one:

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1. Calculate the front‐end ratio, which compares the monthly mortgage payment (PITI) to gross income:

$$
   \text{Front-end ratio} = \frac{510.51}{2730} \approx 0.187 \text{ or } 18.7\%
   $$

Since $$18.7\% < 28\%$$, the front‑end ratio guideline is met.

2. Calculate the back‑end ratio, which includes all monthly obligations (PITI plus other debts):

$$
   \text{Total obligations} = 510.51 + 431.34 = 941.85
   $$

$$
   \text{Back-end ratio} = \frac{941.85}{2730} \approx 0.345 \text{ or } 34.5\%
   $$

Since $$34.5\% < 36\%$$, the back‑end ratio guideline is met.

3. Because both the front‑end and back‑end ratios are within the acceptable guidelines, you would qualify for a conventional mortgage.
You qualify for a conventional mortgage.

Suppose you earn a gross income of per month and apply for a mortgage with a monthly PITI of . You have other financial obligations
totaling per month. (Use the ratio guidelines on page 468 .) What type of mortgage, if any, would you qualify for?
Select one:

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Suppose you earn a gross income of per month and apply for a mortgage with a monthly PITI of . You have other financial obligations totaling per month. (Use the ratio guidelines on page 468 .) What type of mortgage, if any, would you qualify for? Select one: