U
SER
’
S
G
UIDE
— 9
(Cont’d)
2) Calculates the maximum loan amount for
which a buyer may qualify, based on the stored
income and debt qualifying ratios and the entered:
•
Term
•
Interest
•
Annual Income
•
Monthly Debt
—and optional—
•
Annual Property Tax and Insurance
•
Annual Mortgage Insurance (Private Mortgage
Insurance or PMI)
•
other monthly housing expenses (e.g., home-
owner’s association dues)
The output of this key is as follows:
Press Calculation
1
Displays stored Qualifying Ratios (e.g.,
28%-36%)
2
Restricted/Maximum Qualifying Loan
Amount *
3
Buyer’s Actual Ratios (Income%:Debt%)
4
Unrestricted Qualifying Loan Amount *
5
Maximum Allowable Debt
*Note: The Maximum Qualifying Loan Amount is the “restricted”
loan amount the buyer may qualify for. This loan amount is
based on whichever of the two ratios — income or debt — limits
the buyer the most. The Unrestricted Qualifying Loan Amount,
however, is the higher loan amount. This loan amount is based
on whichever of the two ratios — income or debt — limits the
buyer the least. In other words, whichever ratio will give the
buyer the highest qualifying loan amount. For this Unrestricted
loan amount, the calculator will display the letters “UNR” (for
unrestricted) in the display and the word “INC” or “DEBT” to indi-
cate what ratio side this loan amount was based from (i.e.,
income or debt).
This restricted/unrestricted qualifying loan comparison is useful to
show clients what size loan they could qualify for if they paid off
debt or increased income.
(Cont’d)
