How Large of an FHA Loan Can I Qualify for?
Your monthly housing costs should not exceed 29% of your gross monthly income for an FHA Loan. Total housing costs often lumped together are referred to as PITIMI.
P = Principal
I = Interest
T = Taxes
I = Insurance
MI - Mortgage Insurance (always required)
Monthly Income x .29 = Maximum PITIMI
$3,000 x .29 = $870 Maximum PITIMI per month.
Your total monthly costs, or debt to income (DTI) adding PITIMI and long-term debt like car loans or credit cards, should not exceed 41% of your gross monthly income.
Monthly Income x .41 = Maximum Total Monthly Costs
$3,000 x .41 = $1230
$1,230 total - $870 PITIMI = $360 Allowed for Monthly Long Term Debt
FHA Loan ratios are more stringent than a typical conventional loan.