The FHA's rule of thumb is that your mortgage payment should not be more than 31 percent of your gross monthly income. The rest of the mortgage industry calls this the front-end ratio.
Total Mortgage Payment
In evaluating your mortgage expense, your lender will assess the total mortgage payment, which includes:
Principal and interest
Escrow deposits for taxes
Hazard and mortgage insurance premiums
Homeowner's dues, if applicable
Other Included Costs
Your lender will total these mortgage-related costs and divide them into your monthly gross income. The DTI mortgage expense ratio should be 31 percent or lower.