Posted on
August 10, 2009
at
2:50 am
I'd like to know how to do mine. Could you give me a step by step instruction on how debt to income ratio is calculated? Thank you!
Posted on
August 10, 2009
at
2:56 am
Okay, here's how to calculate your debt to income ratio:-Add up your total net monthly income (your monthly wages,overtime pay, commissions, guaranteed bonuses, and/or alimony payment -if there's any.
*If your income varies, figure the monthly average for the past two years. Include all monies.-Next, add up your monthly bills (credit card bills, loan and mortgage payments, if your renting add that too) -Now it's time to do division, your total monthly bills divided by your total monthly income. The result is your total debt-to-income ratio.
Posted on
August 10, 2009
at
2:58 am
Are the consumer's credit score and the debt to income ratio the same things?
Posted on
August 10, 2009
at
3:01 am
No they are not, they are obtained differently, but the consumer's credit score and his/her debt to income ratio are what the creditors/lenders use to determine the consumer's credit worthiness.-The credit score is obtained from the three major credit bureaus.-The consumer would have to calculate his/her own debt to income ratio.
Posted on
August 10, 2009
at
3:17 am
If you are wondering what a good credit score is, the closer to 0 the debt to income ratio is, the better.
Posted on
August 10, 2009
at
3:28 am
I agree with that..or it is preferable to keep your payments to below 36% of your income-- If you go higher than 36%, you might be slapped higher interest rates.
