General Mortgage KnowledgeQuestion 140 of 400
A borrower earns $9,000 gross monthly with a maximum back-end ratio of 43%. Existing monthly debts are $1,000. What is the largest PITI allowed?
a.$3,870
b.$2,000
c.$3,000
d.$2,870
Explanation
Max total debt = 43% x $9,000 = $3,870. Subtract existing debts: $3,870 - $1,000 = $2,870 maximum PITI. $3,870 forgets to subtract the other debts.
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