Fannie, Freddie, FHA and USDA – Installment Debt Under 10 Months – Will any of the agencies not count debt that is paid down to 10 months or less?

FHA Answer: Unfortunately, FHA does not allow for debt to be paid down to the 10-month payment level in order to exclude it from the DTI calculation.  See the full guideline below. Reference: 4000.1, II, A, 4, b, iv (A) General Liabilities and Debts (TOTAL)The Mortgagee must determine the Borrower’s monthly liabilities by reviewing all debts [...]