We are going to explore debt to income ratio (DTI) over the next few days.
The purpose of this blog series will be to help educate our readers about what DTI means, how it is used and why it is so important.
Let’s start our exploration with a definition of debt to income ratio. This ratio, simply stated, is the amount of money you make compared to the amount of money you owe.
You make a certain amount of money each month. That is your income. How much you owe is recorded by what your credit report shows. (If you borrowed from a relative, it does not get recorded into your DTI). If you are going to apply to an institution for any type of credit or loan, the institution will compare total monthly income to total monthly debt. The higher the ratio the more of an “at risk” borrower you are. These institutions will be less likely to lend you money if you have too much debt.
Creditors are using DTI more often as a reason for turning down credit applications.
Spotya! Payday Loans does not use DTI as a decision factor. In fact, it does not even pull up your credit. Two major qualifiers for payday loans is if you have a steady job and a working bank account. This does not mean that you will be approved for any amount. Spotya! has its own calculations based on your income as to how much it is willing to lend.
There is less risk of default for payday loan companies because their loans are smaller and payback is scheduled according to your pay schedule. Fast money to your account and a short payback period make Spotya! Payday Loans a great service to good people.
