Qualifying Ratio Calculator

✖Total Monthly Debt Payments refer to the combined amount of money a person or entity is required to pay toward their debts on a monthly basis.ⓘ Total Monthly Debt Payments [TMDP]			+10% -10%
✖Gross Monthly Income is the total amount of money earned before deductions or expenses are taken into account, typically calculated on a monthly basis.ⓘ Gross Monthly Income [GMI]			+10% -10%

✖Debt to Income Ratio is a financial metric representing the percentage of a person's monthly gross income that goes toward paying debts.ⓘ Qualifying Ratio [DTIR]

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Formula

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Qualifying Ratio

Formula

`"DTIR" = ("TMDP"/"GMI")*100`

Example

`"32.06897"=("46500"/"145000")*100`

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Qualifying Ratio Solution

STEP 0: Pre-Calculation Summary

Formula Used

Debt to Income Ratio = (Total Monthly Debt Payments/Gross Monthly Income)*100
DTIR = (TMDP/GMI)*100
This formula uses 3 Variables

Variables Used

Debt to Income Ratio - Debt to Income Ratio is a financial metric representing the percentage of a person's monthly gross income that goes toward paying debts.
Total Monthly Debt Payments - Total Monthly Debt Payments refer to the combined amount of money a person or entity is required to pay toward their debts on a monthly basis.
Gross Monthly Income - Gross Monthly Income is the total amount of money earned before deductions or expenses are taken into account, typically calculated on a monthly basis.

STEP 1: Convert Input(s) to Base Unit

Total Monthly Debt Payments: 46500 --> No Conversion Required
Gross Monthly Income: 145000 --> No Conversion Required

STEP 2: Evaluate Formula

Substituting Input Values in Formula

DTIR = (TMDP/GMI)*100 --> (46500/145000)*100

Evaluating ... ...

DTIR = 32.0689655172414

STEP 3: Convert Result to Output's Unit

32.0689655172414 --> No Conversion Required

FINAL ANSWER

32.0689655172414 ≈ 32.06897 <-- Debt to Income Ratio

(Calculation completed in 00.004 seconds)

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Credits

Created by Keerthika Bathula

Indian Institute of Technology, Indian School of mines, Dhanbad (IIT ISM Dhanbad), Dhanbad

Keerthika Bathula has created this Calculator and 50+ more calculators!

Verified by Vishnu K

BMS College of Engineering (BMSCE), Bangalore

Vishnu K has verified this Calculator and 200+ more calculators!

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Qualifying Ratio Formula

Debt to Income Ratio = (Total Monthly Debt Payments/Gross Monthly Income)*100
DTIR = (TMDP/GMI)*100

What is Qualifying Ratio ?

A qualifying ratio is a financial benchmark used by lenders to assess a borrower's eligibility for a loan. This ratio compares the borrower's income to their proposed debt obligations, such as monthly mortgage payments, property taxes, insurance, and other recurring debts. Lenders typically use two types of qualifying ratios: the front-end ratio, which includes housing-related expenses, and the back-end ratio, which includes all recurring debts. These ratios help lenders evaluate the borrower's ability to manage their debt load and determine if they can afford the loan they are applying for based on their income level. Lower qualifying ratios indicate a lower risk for lenders, while higher ratios may suggest potential financial strain for the borrower. The specific qualifying ratios can vary depending on the type of loan and lender's guidelines.

How to Calculate Qualifying Ratio?

Qualifying Ratio calculator uses Debt to Income Ratio = (Total Monthly Debt Payments/Gross Monthly Income)*100 to calculate the Debt to Income Ratio, The Qualifying Ratio is a financial benchmark used by lenders to evaluate a borrower's eligibility for a loan, typically comparing the borrower's income to their proposed debt obligations. Debt to Income Ratio is denoted by DTIR symbol.

How to calculate Qualifying Ratio using this online calculator? To use this online calculator for Qualifying Ratio, enter Total Monthly Debt Payments (TMDP) & Gross Monthly Income (GMI) and hit the calculate button. Here is how the Qualifying Ratio calculation can be explained with given input values -> 32.06897 = (46500/145000)*100.

FAQ

What is Qualifying Ratio?

The Qualifying Ratio is a financial benchmark used by lenders to evaluate a borrower's eligibility for a loan, typically comparing the borrower's income to their proposed debt obligations and is represented as DTIR = (TMDP/GMI)*100 or Debt to Income Ratio = (Total Monthly Debt Payments/Gross Monthly Income)*100. Total Monthly Debt Payments refer to the combined amount of money a person or entity is required to pay toward their debts on a monthly basis & Gross Monthly Income is the total amount of money earned before deductions or expenses are taken into account, typically calculated on a monthly basis.

How to calculate Qualifying Ratio?

The Qualifying Ratio is a financial benchmark used by lenders to evaluate a borrower's eligibility for a loan, typically comparing the borrower's income to their proposed debt obligations is calculated using Debt to Income Ratio = (Total Monthly Debt Payments/Gross Monthly Income)*100. To calculate Qualifying Ratio, you need Total Monthly Debt Payments (TMDP) & Gross Monthly Income (GMI). With our tool, you need to enter the respective value for Total Monthly Debt Payments & Gross Monthly Income and hit the calculate button. You can also select the units (if any) for Input(s) and the Output as well.

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