The size of the down payment can directly affect the buyers borrowing power. If the loans is being made by a bank that will sel1 the mortgage on the secondary market to Fannie Mae and Freddie Mac, the borrower who puts 20% down will usually be allowed to devote up to 28% of the gross, pre-tax monthly income toward housing expenses.
Borrowers with 10% down can usually put just 25% of gross income toward housing expenses.

Buyers who can’t meet these debt ratios have some options First they can seek out a bank that will keep their loan on its books instead of selling it to Fannie Mae or Freddie Mac. Their rate maybe slightly higher, but they have a little more leeway in their debt ratios.A1so, buyers who can’t meet the, standard debt ratios may be attracted to an adjustable rate mortgage. Its lower introductory rate may make it easier to qualify for loan or allow the borrower to get a bigger loan and nicer home.