Which factors are NOT included when calculating DTI ratios?

Which factors are NOT included when calculating DTI ratios?

• A. Utility bills, car insurance, gas, food, etc.
• B. Only count housing and what shows on the credit report
• C. Mortgage payments and taxes
• D. Car payments and student loans

Answer: (A)

DTI looks at how much of your gross monthly income is tied up in paying debts each month. It includes housing costs (mortgage or rent plus property taxes and homeowners insurance) and other periodic debt payments (auto loans, student loans, credit card minimums, alimony/child support). It does not count everyday living expenses like utilities, groceries, gas, and food, which are not debts. So the factors not included when calculating DTI are the living expenses such as utility bills, car insurance, gas, and food.

DTI looks at how much of your gross monthly income is tied up in paying debts each month. It includes housing costs (mortgage or rent plus property taxes and homeowners insurance) and other periodic debt payments (auto loans, student loans, credit card minimums, alimony/child support). It does not count everyday living expenses like utilities, groceries, gas, and food, which are not debts. So the factors not included when calculating DTI are the living expenses such as utility bills, car insurance, gas, and food.