Debt to Income Ratio: This is a ratio which arrives by comparing total debt liability to total income on a monthly basis. It may be calculated by simple procedure, just by adding all monthly payments which are made against your debts, for example, monthly credit card payments, car loan installment, payday loan, investment loan, housing expenses such as rent, interest, property taxes and insurance, and any home over association fees, and then divide the outcome by monthly gross income (total income before taxes are paid). This ratio is multiplied by 100 to show it as a percentage.
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