Finance
The debt-to-income (DTI) ratio used by conventional lenders typically measures:
AMonthly debt payments divided by monthly gross income✓ Correct
BAnnual income divided by total debt
CMonthly net income minus monthly expenses
DTotal assets divided by total liabilities
Explanation
The DTI ratio is calculated by dividing total monthly debt payments (including the proposed housing payment) by gross monthly income. Conventional lenders typically prefer a DTI of 43% or less.
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