Rolling back debt ratio limits

These days, mortgage applicants who carry high debt—relative to reported income—have countless options. Alternative lenders line up to help qualified borrowers stretch their buying power.

Non-industry types may deem that imprudent, but debt service ratios (at the time of origination) are only a secondary predictor of defaults.

What matters more are factors like credit score, loan-to-value and liquid assets. And in terms of loss mitigation, the property (e.g., type, quality, location, etc.) is understandably key.

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