Your debt service ratio is a measure of your capacity to carry debt. It is usually calculated like this:
After-tax monthly income / total monthly required payments on outstanding debt.
Student loans are treated differently than CC debt, and likely would not be added into your current debt service ratio (depending on a series of factors including how soon they will kick in, how much your income is and how large the loans are).
The interest rate on your credit cards is a factor only inasmuch as they affect the monthly required repayment. Usually you are required to pay 3% of the outstanding balance of any card any month.
The quality of your income may also be a factor. Employment income is viewed differently than, for example, a TAship at a university for graduate school.
Hope that helps a little!
After-tax monthly income / total monthly required payments on outstanding debt.
Student loans are treated differently than CC debt, and likely would not be added into your current debt service ratio (depending on a series of factors including how soon they will kick in, how much your income is and how large the loans are).
The interest rate on your credit cards is a factor only inasmuch as they affect the monthly required repayment. Usually you are required to pay 3% of the outstanding balance of any card any month.
The quality of your income may also be a factor. Employment income is viewed differently than, for example, a TAship at a university for graduate school.
Hope that helps a little!
