The article emphasizes that having some debt can be beneficial when purchasing a home, provided it's manageable. The debt-to-income (DTI) ratio plays a critical role in determining mortgage eligibility, with lenders preferring a DTI of 42% or lower. It reassures prospective buyers that reducing debt is helpful, but not a prerequisite for home ownership. The article offers insights into evaluating DTI as a first step toward obtaining a mortgage, underscoring the importance of financial management when considering buying a house.
Understanding your debt-to-income ratio is crucial since it directly impacts your chances of qualifying for a mortgage. Higher DTI means more reluctance from lenders.
While reducing your debt is important, it's not necessary to be entirely debt-free before pursuing home ownership. Many can own homes despite existing debt.
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