Ratios

When an application is open, the different ratios are displayed at the top of the screen. These ratios are updated when the application is saved.

The Deal column displays ratios based on all applicants and co-signers entered on the deal regardless if they are assigned to a mortgage or not. A guarantor never affects the deal ratios.

Each mortgage column (1st Mtg, 2nd Mtg, and 3rd Mtg) displays ratios based on the applicants and any co-signers assigned to that respective mortgage. A guarantor never affects the mortgage ratios.

1st Mtg - calculated based on the applicants and co-signers assigned to the 1st mortgage.

2nd Mtg - calculated based on the applicants and co-signers assigned  to the 2nd mortgage.

3rd Mtg - calculated based on the applicants and co-signers assigned to the 3rd mortgage.

Also note that the deal and mortgage ratios are based on the qualifying details that are entered for the deal.

A ratio window provides users with details regarding the GDS, TDS and LTV calculations:

• The window can be accessed by clicking on the GDS/TDS/LTV hyperlinks (when enabled) within the top section of Expert.
  
  
• The various ratios details can be displayed by clicking on the tabs at the top of the window.
  
  
• Within each tab, certain data elements display as hyperlinks which, when clicked, will direct the user to the appropriate field in Expert to view/update the value.
  
  
• Certain data elements display as rollovers which allow the users to view a breakdown of values that make up the subtotal presented.
  
  
• GDS, TDS and LTV hyperlinks will NOT be enabled under the following scenarios:
  
  
• The corresponding ratio is zero.
  
  
• A mortgage on the deal has been co-brokered.
  
  
• The deal has a rental income option of "Reduce Rental exp., add bal to Gross Inc."
  
  
• The deal has more than one mortgage being requested.
  

Related Topics: About Additional Applicants and Unassigning Applicants from Mortgage

Manually Calculating Ratios

To manually calculate ratios, follow the formulae below where:
 

P = Principal

I = Interest

T = Property Taxes

H = Heating costs

CF = Condo Fees

L = Liability

GAI = Gross Annual Income

n.b.  it is useful to convert all of your figures to annual or monthly before calculating the ratios manually.

Gross Debt Service Ratio:

GDS = ( (P + I + T + H + (CF x .50) ) x 12) / GAI

OR

Monthly mortgage payment (P+I) + Taxes (T) + Heat (H) + ½ Condo Fees* x 12
/

Gross Annual income

*Monthly

Note: Expert automatically uses 50% of condo fees in the calculation.

Note: Some lenders may vary this calculation, so therefore use the calculations as a guideline.  Be sure to track your lender preferences.

Total Debt Service Ratio:

TDS = ( (P + I + T + H + L + (CF x .50) ) x 12) / GAI

OR

Mortgage payments* (P+I) + Taxes* (T) + Heat* (H) + Liabilities* + ½ Condo Fees* x 12

/

Gross Annual income

*Monthly

Note: Expert automatically uses 50% of condo fees in the calculation.

Note: Some lenders may vary this calculation, so therefore use the calculations as a guideline.  Be sure to track your lender preferences.

Loan to Value:

Amount of Mortgage(s)/ Value of the Home = LTV

Net Worth:

Assets - Liabilities = Net Worth