Final answer:
Yes, mortgage insurance (MI) is factored into the Debt-to-Income (DTI) ratio. DTI is a measure of a person's debt relative to their income, and mortgage insurance is included in the borrower's monthly housing expenses and is factored into their DTI ratio.
Step-by-step explanation:
Yes, mortgage insurance (MI) is factored into the Debt-to-Income (DTI) ratio. DTI is a measure of a person's debt relative to their income and is used by lenders to assess a borrower's ability to repay a loan. Mortgage insurance is typically required when a borrower makes a down payment of less than 20% on a home purchase, and it helps protect the lender in case the borrower defaults on the loan. The cost of mortgage insurance is included in the borrower's monthly housing expenses and is factored into their DTI ratio.