re: Homebuyers are now spending 40% of their gross income on mortgage and interest costs

I just copied the first 3 lines of the OP. I understand he or she was just copying from twitter. They start by saying, “Homebuyer DTI is now approaching 40% in 2023.” The next statement reads, “That means homebuyers are now spending 40% of their gross income on mortgage and interest costs.”

That’s not what that means though. Homebuyer DTI approaching 40% just means their total debt to income ratio is 40%…this number includes mortgage debt. The banks always include your future mortgage when they are figuring your DTI when applying for a loan.