Securing Hannav Ledger...
Securing Hannav Ledger...
Glossary
Debt-to-Income ratio compares total monthly debt obligations to gross monthly income, used by lenders to assess repayment capacity.
DTI shows what share of income goes to EMIs — banks prefer lower DTI before approving big loans like home loans.
FOIR (Fixed Obligation to Income Ratio) used in India — typically existing EMIs plus proposed EMI should not exceed 40–50% of net monthly income. Self-employed assessed on average banking credits and ITR income.
Net income ₹1,00,000; existing EMI ₹15,000; proposed home EMI ₹35,000 → FOIR 50% — at lender ceiling, may reduce eligible loan amount.
DTI = (Total Monthly Debt Payments ÷ Gross Monthly Income) × 100Most banks cap FOIR at 40–55% including new EMI. Lower DTI improves approval and may negotiate better rate.
Revolving minimums and 5% of outstanding may count depending on lender policy — reduce card debt before applying.
Combined income and combined EMIs assessed, improving eligibility when co-applicant income is strong.