Debt-to-Income Ratio (DTI)
GeneralGlossary term
Definition
The percentage of your gross monthly income that goes toward paying debts. Lenders use DTI to assess your ability to manage monthly payments and repay borrowed money.
Related terms
- MortgageA loan used to purchase real estate where the property serves as collateral. The borrower makes regular payments over a set term (typically 15-30 years) until the loan is paid off.
- Credit ScoreA numerical representation (typically 300-850) of your creditworthiness based on your credit history. Higher scores indicate lower credit risk and can lead to better loan terms.
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