Traditional revolving credit cards in which your credit continually revolves month-to-month have a varying impact on your debt ratio. It all depends on the balance of the credit card when a lender pulls your credit. An open charge card, such as an AMEX, is very different. Open charge cards must be paid off in full each month. So for instance, if you typically charge $10,000 to your open charge card each month, but always end up paying it off, do you have to factor in the $10,000 monthly payment to your debt ratio? The answer is generally: No, provided you’re able to prove you can afford this debt, as well as satisfy a few other requirements. It’s best to contact your mortgage broker for more information.
