Example #2: Change of circumstance. (People in the industry will appreciate this play on words). This can come into play in various ways. This is mostly seen on borrowers that get prequalified MONTHS in advance. An unexpected decline in year-to-date income such as commission, bonus or sometimes even self-employed can cause the DTI to increase. Interest rates may rise causing the DTI to increase. For these reason alone, most lenders will not completely max out your debt ratio when they prequalify you. We leave a bit of a cushion for something that could turn up like higher than average monthly HOA dues, higher than average property taxes, etc. This example is more on the rare side but something that the loan officer should be taken into consideration when prequalifying a buyer and giving the green light on a max purchase price.