Posted on
September 3, 2009
at
5:38 am
The banks/lenders want to make sure that if a consumer borrows from them, they would return what they've borrowed. One way for them to determine if the applying consumers are eligible for that loan is finding out their debt ratios. The consumer's total debt should not exceed a certain percentage of his/her income, usually 36-42%.or else, he/she may be turned down.
Posted on
September 3, 2009
at
5:44 am
Finding debt ratios involves calculation. It's important to learn how to get one's debt to income ratio as getting a low interest mortgage loan depends on it. The closer to the lenders 28/36 rule is the better.
Posted on
September 3, 2009
at
5:54 am
Some important elements in finding debt ratios:The back-end ratio- is the portion of a consumer's monthly income that goes toward paying debts.The front-end ratio- A ratio that indicates what portion of a consumer's income is used to make mortgage payments. It's the consumer's monthly housing expenses divided by monthly gross incomeBanks/lenders use these ratios to approve mortgages.
Posted on
September 3, 2009
at
5:56 am
What should the consumer do if or after finding that his/her debt ratios exceed 40%?
Posted on
September 3, 2009
at
6:05 am
The consumer must pay down or eliminate his/her debt first. If the consumer has mostly unsecured debts, credit counseling or debt settlement might help. For total debts amounting to less than $10,000 with high interest rates, credit counseling may make sense. If it is more than $10,000 and the accounts past due, debt settlement is better.Destroydebt.com offers a free initial consultation. Just fill out a form.
Posted on
September 9, 2009
at
10:58 pm
In terms of finding debt ratios, how will i know which method is the best for me
