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How Much Credit Card Debt is Acceptable for Mortgage

When it comes to applying for a mortgage, credit card debt is one factor that lenders consider in their decision-making process. While there is no set limit on how much credit card debt is acceptable for a mortgage, lenders will evaluate your creditworthiness based on a range of factors, including your credit score, income, and debt-to-income ratio.

A mortgage is a type of loan that is used to purchase a property, such as a home or a commercial building. In this arrangement, the lender (usually a bank or a financial institution) provides the borrower with a lump sum of money upfront, which is then paid back over a fixed period of time, typically 15 to 30 years, with interest.

Mortgages can be used to purchase both residential and commercial properties. The terms and conditions of a mortgage can vary depending on the lender, the borrower's financial situation, and the type of property being purchased.

When applying for a mortgage, lenders will evaluate the borrower's creditworthiness based on a range of factors, including their credit score, income, employment history, and debt-to-income ratio. Lenders will also consider the size of the down payment, which is the amount of money the borrower is able to put towards the purchase of the property upfront.

Generally, a larger down payment will result in lower monthly payments and a lower overall interest rate. We will again come to the same point that how much credit card debt is acceptable for mortgage.

How Much Credit Debt is Acceptable for Mortgage 

Debt-to-income ratio is a critical factor that lenders use to determine your ability to repay your mortgage loan. This ratio is the percentage of your monthly income that goes towards paying off your debts, including credit card balances, car loans, and other loans.

Lenders typically prefer a debt-to-income ratio of 43% or lower, which means that your total debt payments (including your mortgage) should not exceed 43% of your monthly income.

If you have a high amount of credit card debt, it can significantly impact your debt-to-income ratio, which could make it more difficult to qualify for a mortgage. Lenders may also view high credit card balances as a sign of financial instability, which could raise concerns about your ability to make timely mortgage payments.

However, having some credit card debt is not necessarily a deal-breaker for a mortgage application. Lenders will also consider other factors, such as your payment history, credit score, and employment history. If you have a strong credit score and a stable income, lenders may be more willing to overlook a moderate amount of credit card debt.

In general, it is recommended that you keep your credit card balances low and pay off as much debt as possible before applying for a mortgage. This will help you maintain a healthy debt-to-income ratio and demonstrate to lenders that you are financially responsible.


In summary, there is no set limit on how much credit card debt is acceptable for a mortgage. Lenders will evaluate your overall financial situation, including your debt-to-income ratio, credit score, and payment history, to determine your creditworthiness.

Keeping your credit card balances low and paying off as much debt as possible can help you improve your chances of qualifying for a mortgage.

By Author: Sam Peterson | 03 Mar 2023

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