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Mortgage Glossary

Qualifying Ratio

Mike Starr·Reviewed August 2026

Qualifying ratios are the guidelines lenders use to determine whether a borrower can afford a mortgage. The front-end ratio compares housing costs to gross income (typically capped at 28%). The back-end ratio compares all monthly debt obligations to gross income (typically capped at 36-43%). Lenders may allow higher ratios for borrowers with strong compensating factors.