Definitions for "Total debt ratio"
Keywords:  gross, piti, divided, ratio, monthly
A standard calculation performed by mortgage lenders to determine if a borrower qualifies for a specific loan type. It is calculated by dividing the monthly housing expense (Principal, Interest, Taxes and Insurance plus all other monthly debt obligation) by the borrower's monthly gross income. Also referred to as a back end ratio or a bottom ratio.
The amount paid by the borrower for principal, interest, taxes and insurance and any recurring monthly debt, divided by repayment income. (last updated 03/19/2004)
Monthly debt and housing payments, divided by gross monthly income, to prove that the seller can transfer free and clear ownership.