Question 1

On a $200,000 loan amount, how much would 2 discount points cost?

Accepted Answer

One point equals 1% of the loan amount. On $200,000, one point is $2,000, so 2 points cost $4,000.

Question 2

On a $275,000 loan amount, how much would 2 discount points cost?

Accepted Answer

One point equals 1% of the loan amount. On $275,000, one point is $2,750, so 2 points cost $5,500.

Question 3

A borrower earns $6,000 gross monthly income. The proposed housing payment is $1,500 per month, and the borrower also pays $400 for a car loan and $200 for student loans each month. What is the back-end DTI ratio?

Accepted Answer

Back-end DTI = (housing payment + other monthly debts) / gross monthly income. Here that is ($1,500 + $400 + $200) / $6,000 = $2,100 / $6,000 = 35.0%, which rounds to 35%.

Question 4

A borrower earns $7,200 gross monthly income. The proposed housing payment is $1,800 per month, and the borrower also pays $300 for a car loan and $150 for student loans each month. What is the back-end DTI ratio?

Accepted Answer

Back-end DTI = (housing payment + other monthly debts) / gross monthly income. Here that is ($1,800 + $300 + $150) / $7,200 = $2,250 / $7,200 = 31.2%, which rounds to 31%.

Question 5

A borrower earns $5,500 gross monthly income. The proposed housing payment is $1,400 per month, and the borrower also pays $250 for a car loan and $350 for student loans each month. What is the back-end DTI ratio?

Accepted Answer

Back-end DTI = (housing payment + other monthly debts) / gross monthly income. Here that is ($1,400 + $250 + $350) / $5,500 = $2,000 / $5,500 = 36.4%, which rounds to 36%.

Question 6

A borrower earns $8,000 gross monthly income. The proposed housing payment is $1,900 per month, and the borrower also pays $500 for a car loan and $300 for student loans each month. What is the back-end DTI ratio?

Accepted Answer

Back-end DTI = (housing payment + other monthly debts) / gross monthly income. Here that is ($1,900 + $500 + $300) / $8,000 = $2,700 / $8,000 = 33.8%, which rounds to 34%.

Question 7

A borrower earns $7,000 gross monthly income. The proposed housing payment is $1,750 per month, and the borrower also pays $350 for a car loan and $450 for student loans each month. What is the back-end DTI ratio?

Accepted Answer

Back-end DTI = (housing payment + other monthly debts) / gross monthly income. Here that is ($1,750 + $350 + $450) / $7,000 = $2,550 / $7,000 = 36.4%, which rounds to 36%.

Question 8

A borrower earns $10,000 gross monthly income. The proposed housing payment is $2,400 per month, and the borrower also pays $700 for a car loan and $500 for student loans each month. What is the back-end DTI ratio?

Accepted Answer

Back-end DTI = (housing payment + other monthly debts) / gross monthly income. Here that is ($2,400 + $700 + $500) / $10,000 = $3,600 / $10,000 = 36.0%, which rounds to 36%.

Question 9

A borrower earns $6,200 gross monthly income. The proposed housing payment is $1,550 per month, and the borrower also pays $325 for a car loan and $225 for student loans each month. What is the back-end DTI ratio?

Accepted Answer

Back-end DTI = (housing payment + other monthly debts) / gross monthly income. Here that is ($1,550 + $325 + $225) / $6,200 = $2,100 / $6,200 = 33.9%, which rounds to 34%.

Question 10

A borrower earns $6,500 gross monthly income. The proposed housing payment is $1,600 per month, and the borrower also pays $450 for a car loan and $250 for student loans each month. What is the back-end DTI ratio?

Accepted Answer

Back-end DTI = (housing payment + other monthly debts) / gross monthly income. Here that is ($1,600 + $450 + $250) / $6,500 = $2,300 / $6,500 = 35.4%, which rounds to 35%.

Financial Calculations Practice Questions

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