What you should know about the market
When applying for a home
loan, one of the factors lenders consider is the percent of the
borrower’s income used for housing expenses, as well as the borrower’s
other non-housing related debt. Although this amount can vary by
lender, typically lenders consider a housing-and-debt to income ratio of
less than 40 percent as ideal.
During
the recession, some companies changed staffers from salaries or hourly
wages to commission-based. This can make financing a home more
difficult as most lenders do not include commission income when
evaluating a borrower’s eligibility for a home loan, unless the
borrower has been earning commissions for at least two years.