3 Things To Know About Your Debt-To-Income Ratio Before Applying For A Home Loan
When you apply for a home loan, the lender will thoroughly analyze your financial situation before approving the loan, and one of the factors that lenders consider is an applicant's debt-to-income (DTI) ratio. Before you apply for a loan, you should understand what this is, why it matters, and how to improve yours. What is a DTI ratio? Your DTI ratio is calculated by dividing all of your normal monthly expenses by your gross monthly income.