DTI measures total monthly debt payments (all EMIs, credit card minimums, other fixed obligations) as a percentage of gross monthly income. DTI = (Total Monthly Debt Payments / Gross Monthly Income) × 100. Similar to FOIR used by Indian lenders.
A DTI below 36% is considered healthy; below 50% is acceptable for most lenders. DTI above 50% signals over-indebtedness and reduces chances of loan approval. Improving DTI requires either increasing income or reducing existing debt obligations.
DTI is a key indicator of financial health and borrowing capacity. Keeping it low ensures access to credit when needed and prevents over-indebtedness.
Nihal Fintech assesses each client’s DTI to recommend appropriate loan amounts and strategies for managing overall debt levels responsibly.
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