Example
In order to qualify for a mortgage for which the lender requires a debt-to-income ratio of 28/36:
- Yearly Gross Income = $45,000 / Divided by 12 = $3,750 per month income.
- $3,750 Monthly Income x .28 = $1,050 allowed for housing expense.
- $3,750 Monthly Income x .36 = $1,350 allowed for housing expense plus recurring debt.
Read more about this topic: Debt-to-income Ratio
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“Our intellect is not the most subtle, the most powerful, the most appropriate, instrument for revealing the truth. It is life that, little by little, example by example, permits us to see that what is most important to our heart, or to our mind, is learned not by reasoning but through other agencies. Then it is that the intellect, observing their superiority, abdicates its control to them upon reasoned grounds and agrees to become their collaborator and lackey.”
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