Debt-to-income ratio

A debt-to-income ratio (often abbreviated DTI) is the percentage of a consumer's monthly gross income that goes toward paying debts.

Debt-To-Income Ratio - DTI
A personal finance measure that compares an individual's debt payments to the income he or she generates.

Debt-to-income ratio
A debt-to-income (DTI) ratio is determined by dividing the amount of your outstanding debt by your total income. It is stated as a percentage.

The debt-to-income ratio (DTI) is a measurement of and individual or corporations ability to sustain their debt load. This is also the leading indicator for the lending institutions to see if the borrower is capable of absorbing more debt.

Metrics include debt-to-income ratio (combined total of residential mortgages, lines of credit and other consumer loans as a percentage of personal disposable income); ...

Qualifying for a mortgage will require an acceptable debt-to-income ratio. Credit cards, car loans and any other financial debts figure into this calculation. It is a good idea to see how much you qualify for before shopping for a home.

Identify Your Debt to Income Ratio (DTI)-Take your total monthly payment added above and divide that number by your base, gross income. This is your Debt-to-Income Ratio; Remember! Do not count your mortgage payment in the equation.

See also: Income, Ratio, Share, Profit, Debt