Lenders look at your debt-to-income ratio to determine whether to lend you money or extend your line of credit.
Use this calculator to estimate your home loan eligibility.
You should strive to keep your DTI below 36%, the lower it is, the greater chance you'll be eligible for a home loan or extension of credit. If you have a DTI of 20% or below that is considered excellent!
Simply add up your minimum monthly debt and divide it by your gross monthly income (income before taxes).
Gross Monthly Income: $2,000.
Total Monthly Debt: $400 (car payment of $350 & credit card minimum payment $50 = $400)
400 / 2000 = 0.2, or 20%
Your DTI is 20%