Finance
What is the debt-to-income (DTI) ratio used for in mortgage lending?
ATo determine the property's market value
BTo evaluate a borrower's ability to manage monthly payments relative to their income✓ Correct
CTo calculate the loan-to-value ratio
DTo determine the interest rate
Explanation
The debt-to-income (DTI) ratio compares a borrower's total monthly debt payments to their gross monthly income. Lenders use it to assess whether the borrower can afford the loan payments.
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