KUALA LUMPUR, April 3 (Bernama) -- Bursa Malaysia ended lower today, with the benchmark index declining 0.5 per cent, weighed down by selected heavyweights led by Press Metal, IHH Healthcare, and Tenaga Nasional. Press Metal shed 16 sen to RM4.87, IHH Healthcare dipped 14 sen to RM6.75, and TNB slipped 18 sen to RM13.58. These stocks resulted in a 6.12-point decline in the benchmark index. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) slid 7.61 points to 1,518.91 versus Wednesday’s close of 1,526.52. The benchmark index opened 9.22 points lower at 1,517.30 and fluctuated between 1,512.32 and 1,524.41 throughout the day. In the broader market, losers thumped gainers 548 to 357, while 448 counters were unchanged, 994 untraded and eight suspended. Turnover rose to 2.51 billion units valued at RM1.81 billion against Wednesday’s 2.37 billion units valued at RM2.03 billion. ...
Upto what extent you can drown into debt in a month, and come out smoothly by repaying, is best shown by your debt to income ratio. This ratio of debt and income is the key method to determine the availability of cash from you monthly income for repayment of your loans….or, in other words, it expresses your true borrowing capability. That’s why creditors consider debt to income ratio a very effective tool to figure out your monthly payment, and your true financial situation. This ratio clearly calculates the total amount of loan an individual can take.
There are 3 categories of debt to income ratio:
Front End and Back End Ratio
Your creditors tend to analyse your debt to income ratio with two numbers 33/38. 38 is the back end ratio. It is the long term debt ratio. And front end ratio is 33, which is the ratio of housing expenses.
Housing Expense Ratio
The payments of an individual’s housing normally means each and every payment you need to make in your day to day life. That includes all of your monthly payment. It includes costs like- principal, interest, taxes, and insurance. The ratio of housing expense is meant for measurement of an indivudual,s income’s percentage which would cover all his housing payments. A limit would be normally set by your creditors on where your debt to income ratio is wanted by them.
For example, sometimes the creditors set a rule that they want your housing expenses should not exceed 28% of your gross monthly income, and like that.
Long Term Debt Ratio
Long Term Debt ratio is used to calculate the specific percentage of an individual’s monthly earning that is available for making repayment of total debt. The calculation of Long Term Debt ratio includes your housing expenses (PITI), auto loans, credit card loans and some other debts.
Here also, the limit seting trend exists like that of your Housing Expense Ratio. The creditors sets a limit to your long term debt ratio. It is also referred as Back End ratio.
There are 3 categories of debt to income ratio:
Front End and Back End Ratio
Your creditors tend to analyse your debt to income ratio with two numbers 33/38. 38 is the back end ratio. It is the long term debt ratio. And front end ratio is 33, which is the ratio of housing expenses.
Housing Expense Ratio
The payments of an individual’s housing normally means each and every payment you need to make in your day to day life. That includes all of your monthly payment. It includes costs like- principal, interest, taxes, and insurance. The ratio of housing expense is meant for measurement of an indivudual,s income’s percentage which would cover all his housing payments. A limit would be normally set by your creditors on where your debt to income ratio is wanted by them.
For example, sometimes the creditors set a rule that they want your housing expenses should not exceed 28% of your gross monthly income, and like that.
Long Term Debt Ratio
Long Term Debt ratio is used to calculate the specific percentage of an individual’s monthly earning that is available for making repayment of total debt. The calculation of Long Term Debt ratio includes your housing expenses (PITI), auto loans, credit card loans and some other debts.
Here also, the limit seting trend exists like that of your Housing Expense Ratio. The creditors sets a limit to your long term debt ratio. It is also referred as Back End ratio.
Lenders take the debt to income ratio of the borrowers to determine their eligibility to obtain the home mortgage loan. Responsibility also lies upon the borrowers to take out a home mortgage loan which is affordable to them.
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