QUOTE (Thaqalain @ Mar 6 2010, 11:08 AM) What`s does DCR, IRD stands for?DCR = Debt Coverage Ratio (the ratio of net income divided over required payments for debt) .. usually has to be 1.2 or higher .. i.e. if net income is $10,000/year for a property then the max. payment for mortgage is about $8333 using a DCR of 1.2 .. and then you can calculate the maximum mortgage given a certain interest rate .. roughly $140,000 at 5% with a 35 year amortization .. or $160,000 with a 4% mortgage rate
IRD = Interest Rate Differential ( the difference between two interest rates, say the borrowing rate by the bank and the rate they charge you .. or between variable and fixed .. or between bond rate and mortgage rate .. depending on context)
IRD = Interest Rate Differential ( the difference between two interest rates, say the borrowing rate by the bank and the rate they charge you .. or between variable and fixed .. or between bond rate and mortgage rate .. depending on context)
Always an interesting topic, and never a definitive answer. I like variable but I always council my clients on what will allow them to sleep. For some the 10 year rate is a bargain right now. 5.2% for 10 years of cost planning, works for some. No one knows what is going to happen for sure except that rates can not go down very much more. You have to do what works for you.