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According to the standard debt-to-income ratio, the person who would be rated as highest in respect of eligibility for a home loan is person C.
<h3>What is a home loan?</h3>A home loan is an amount that has been lent for the acquisition or purchase of any house. or apartment for living.
Given values:
<u>Persons </u> <u> Monthly Incomes </u> <u> Recurring debts </u>
Person A $4,250 ($51,000 / 12) $350
Person B $4,833 ($58,000 / 12) $250
Person C $5,250 ($63,000 / 12) $200
Person D $5,583 ($67,000 / 12) $450
<u>Step-1 </u> Computation of debt-to-income ratio of person A:
<u>Step-2 </u>Computation of debt-to-income ratio of person B:
<u>Step-3 </u>Computation of debt-to-income ratio of person C:
<u>Step-4 </u>Computation of debt-to-income ratio of person D:
Therefore, after finding debt to income ratios of all persons, the lowest ratio comes out to be of Person C at 3.80% which ranked to be the highest.
Learn more about the debt ratio in the related link:
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