Debt Ratio

« Back to Glossary Index

A person’s monthly obligations divided by their monthly income.

Lenders exclude bills that can be cancelled from this number, like cable TV, cell phone bills and insurance. They’re more interested in a person’s minimum required housing expenses, loan payments, credit cards and support payments.

See also: Gross Debt Service (GDS) ratio and Total Debt Service (TDS) ratio

debt service ratio
« Back to Glossary Index