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27 August, 13:24

What is the personal finance measure that compares the debt one owes to overall income?

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  1. 27 August, 13:46
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    Answer: In personal finance, the debt-to-income ratio (DTI) is a measure that compares personal debt to overall income.

    The DIT is calculated by finding the total of an individual's monthly debt obligations. This includes mortgage payments, student loans, auto loans, credit card payments and child support.

    This amount is then divided by an individual's gross monthly income. Gross Monthly Income refers to income before any taxes or other deductions are made.

    The DTI is expressed as a percentage. The lower the value of an DTI, the higher are the chances that an individual gets the desired loan.
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