If you were declined for credit because your monthly debt is too high compared to your monthly income – your debt-to-income (“DTI”) ratio – you may be able to improve it. Your DTI ratio is the amount of your monthly debt payments divided by the amount of your monthly income.
To improve your DTI ratio, consider:
- Paying off debts with fixed monthly payments, like installment loans, and paying down credit card and revolving loan balances.
- Avoiding taking on more debt than what you already have
- Finding ways to increase your income with an alternate side hustle or part-time job
- Keeping your budget tight and curbing any extra credit card spending
You can calculate your DTI ratio with our DTI calculator here. You can also explore different debt paydown strategies based on your goals such as minimizing monthly payments, saving the most on interest, or paying down debt faster with our Debt Manager.
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