What are front (housing) and back (debt to income) ratios?

Part of the mortgage application process will be the determination of how much house you can afford based on your income. The two ratios that will be computed are the front ratio and the back ratio.
Front Ratio: The total mortgage payment including principal, interest, taxes and insurance (PITI) as well as any condominium or homeowner association fees divided by your total GROSS income. According to underwriting industry standards, this ratio must be below 28%. Example: With a gross income of $3,700 per month and a PITI of $973, the front ratio would be 26%.
Back Ratio: The total mortgage payment PLUS any car payments, credit card and other loan payments divided by your total GROSS income. According to underwriting industry standards, the total back ratio should be below 36%. Example: With a gross income of $3,700 per month, a total mortgage payment of &973, a car payment of $212, one credit card payment of $59 and one credit card payment of $43 for a total of $1,287, the back ratio would be 35%.