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Debt-to-Income Ratio Calculator by Money
Money.com
12/10/2020
© Kiersten Essenpreis for Money
Debt-to-Income-Ratio-tightrope
If you are thinking about buying a home, understanding your debt-to-income ratio is crucial. Crunch the numbers with Money’s DTI ratio calculator.
What Is Debt-to-Income Ratio?
Debt-to-income (DTI) ratio is a key financial metric that lets lenders know how much of a borrower’s monthly income goes into paying off debt. This information is used to measure an individual’s capacity of making monthly payments for a loan.
A low ratio indicates that the consumer is a low-risk borrower while a high ratio can mean that the person is at a higher risk of defaulting on their debts. Typically expressed in percentages, DTI ratios are calculated by dividing monthly debt payments by gross monthly income, which refers to the sum total of your monthly earnings (wages, salaries, freelance income, overtime pay, commissions, tips and ot ....

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