Debt-To-Income Ratio Calculator

Published on Sep 15, 2015 11:22 am

Do you have too much debt in the eyes of lenders? One measure is your debt-to-income ratio. Some consider that number as important as your credit score, and it will be evaluated if you ask for a loan or additional credit. A low DTI ratio, which is generally less than 36, shows you have a healthy balance between debt and income. If it’s higher, you might consider lowering it by combining your debt into a single fixed-rate loan. Our Debt-to-Income Calculator can help you better understand how lenders might perceive your credit standing.

Debt-To-Income Ratio Calculator Definitions

  • Total recurring monthly debt — A compilation of all of your monthly debt obligations including mortgages (principal, interest, taxes and insurance), home equity loan payments, car loans, student loans, credit card debt and retailer debt.
  • Gross income — On a personal level, this includes most pre-tax income from all sources including salary, wages, tips, capital gains, dividends, interest, rents, pensions and alimony. Select items may be excluded, including interest on municipal and state bonds; certain Social Security or workers compensation benefits; certain gifts and inheritances; scholarships; some retirement plan contributions; life insurance proceeds and some revenue from home sales.
  • Fixed-rate loan — A loan in which the interest rate doesn’t fluctuate during terms of the agreement.

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This article is provided for general guidance and information. It is not intended as, nor should it be construed to be, legal, financial or other professional advice. Please consult with your attorney or financial advisor to discuss any legal or financial issues involved with credit decisions.
Published by permission from, Inc., an Experian company. © 2015, Inc. All rights reserved.

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