What is your debt-to-income ratio and when is it important

If you’re in the market to take out a loan at an affordable rate, you must be aware of the two most important factors that are checked before giving you a loan. Yes, the numbers that are checked while giving you a loan are your credit score and your debt-to-income ratio, more popularly known as the DTI ratio. Are you aware of what a DTI ratio is and why it holds so much importance during a financial transaction? Read on to know more on this particular topic.

How is your DTI ratio calculated?

As the name suggests, your DTI ratio is nothing but the ratio of monthly income that you make in a month and the debt obligations that you’re supposed to pay in a particular month. The amount of debt will include mortgage debt, car loan debt, student loan debt, credit card debt and any form of other debt that you’re liable to repay. In order to calculate your DTI ratio, you have to add up all your monthly debt obligations and then divide it by the gross monthly income that you make in a month.

When is your DTI ratio checked?

Just as your lenders check your credit score before lending you a loan, they also check your DTI ratio that is your debt to income ratio. If you have a high debt-to-income ratio, this means that you have too many high interest debts in accordance with your monthly income. Therefore, this will imply that you’ll not be able to make the monthly loan payments on time as you may fall short of cash. This is the time when your lenders will charge you high interest rates on the loans. Thus, you must always calculate your DTI ratio before applying for a loan from a lender.

If you want to make sure that you grab the best loan in the market, you must work towards lowering your DTI ratio so that the lenders may be able to offer you a loan with an affordable interest rate. You can easily repay the loan without having to fall back on the other monthly obligations.

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The situation – US stocks as of now

As per recent reports, the US stocks tumbled with the beginning of September, where it is considered that it was the S&P 500’s worst September start in 50 years. It is not only S&P which went through a tumble, the other stocks too dropped. Though, the Federal Reserve Chairman Ben Bernanke did try to instill some amount of confidence, it failed to slow down the investor jitters. So, if you are thinking of investing in the stocks in order to pay off your debts, you should think twice.

US stock situation

The reports on the job market show it to be the weakest in a year. This renewed the fears that US may slip back into another phase of recession. The Treasury yields too fell and the price of gold rose as the investors piled onto investments; gold is seen to be less risky investment option in comparison to stocks.

It was seen that the Dow Jones industrial average fell by 172 points, or by 1.5 percent, which is 11,321. The Standard & the Poor’s 500 indexes fell 20 points, or that is by 1.6 percent, to 1,182. The NASDAQ composite index slipped by 39, or it means by 1.6 percent, which is to 2,507.

All of the 30 stocks in Dow fell by quite a few points. Only one of the stocks which is the Verizon Communications Inc. experienced positive advancement. For each of the stocks that experienced a rise, 11 fell against the New York Stock Exchange, where the volume was almost about 1.1 billion. 

In fact, after moving to and fro in between the small gains and losses for most of the session, stocks went on the highest downgrade after Bernanke gave his speech at Minneapolis. Majority of the investment stock traders had hoped to get far more insight on the plan of the central bank which is supposed to be brought up mainly in order to provide some support to the economy.

On the other hand, following the sharp decline in the stocks or rather the stock index futures, the stock exchanges with the likes of New York Stock Exchange and NYSE Amex Cash Markets have invoked Rule 48 as for the open, thereby lifting the requirement which may call for price indications that may be of some help for the determination of the floor price in the beginning so as to smoothen away the trade.

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Parameters to Be Considered For Getting Cheap Auto Insurance

There is hardly anyone out there who doesn't dream of buying a luxury car. When you buy anything, you make a huge investment and hence you must take care of that product by undertaking several maintenance activities. In order to provide protection to anything you buy, insurance policies can help. You dream of buying a new car, but prior to that confirm everything and fulfill all formalities to provide security to your sedan. Starting from cars for personal use to the giant sedans used for official purposes, several auto insurance policies are available for every category of automobile. However, if you desire to get cheap auto insurance deals, it might be difficult but of course not impossible.

Every car owner wants to avail maximum benefits at cheaper rates. To get cheap auto insurance, however, the insurance seekers must do a thorough research and survey the market well. In recent times, however, doing research has become quite easier because of the availability of the internet connection that enables the users stay connected to the entire world. There are several factors that influence the rate of the auto insurance that ultimately determines whether it is an expensive or cheap auto insurance deal. Thus, if you want to grab the best inexpensive insurance policies for your cars or giant sedans, it is important to consider the following factors:

The place where you live is an important factor. The ones who stay in rural locations are less likely to be engaged in any kind of accidents than those who stay in urban or city areas. Being at a lesser risk of involvement in any road mishap makes it easier for the individuals to get cheap auto insurance deals.

Violation of driving rules affects your insurance rates adversely. Speeding tickets, running red light, etc. supplement the rate of insurance. Thus, if you have a clean driving record, you can easily get the deals at cheaper rates.

The brand of your vehicle and the strength of the engine and other details of the car are also important for determining the rate of insurance.

Past accident claims also act as a primary factor that decides whether you are eligible to get cheap car insurance schemes

Your credit rating and occupation are also vital factors that are taken into account to determine your eligibility for the best cheap auto insurance deals with significant coverage level.

The author is an expert advisor for cheap auto insurance. He has gained immense appreciation from those who have received valuable advices from this cheap auto insurance expert advisor. Reading his articles makes people well aware of all the perspectives surrounding the concept of getting cheap auto insurance deals.

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The real estate investment market as of 2011

It was predicted that the demand for purchasing and houses are going to increase in 2011. The real estate is recovering slowly around the globe and is gaining in momentum in this country too. But till now, the bad mortgage is the main problem that has been creating problems for the real estate investment sector. But still, investors have started to try out their options in the investment market. This is partly because of the stabilizing economic situation of the country. The country is slowly trying to gain back its economic power.

 

Real estate investment situation 

According to many experienced investors and the real estate market watchers, the real estate investment market may actually do much better than what have been expected. The improving and the relatively stabilizing economic conditions in addition to the limited supply, appears to have lifted the real estate industry from its downwarIt was predicted that the demand for purchasing and houses are going to increase in 2011. The real estate is recovering slowly around the globe and is gaining in momentum in this country too. But till now, the bad mortgage is the main problem that has been creating problems for the real estate investment sector. But still, investors have started to try out their options in the investment market. This is partly because of the stabilizing economic situation of the country. The country is slowly trying to gain back its economic power. d trend which it was hit with during the Great Recession.

As the experts say, the real estate investment market is going to benefit in 2011 from two main factors. First of all, the minimal demand for any new space has cut down extensively on the new construction, giving the recent structures the opportunity that may help in regaining some of the value that they have had lost during the recession in 2008. Greater optimism has been brought on by the gradual economic recovery and that has also been able to help in increasing the appraisal values.

Other than this, the intensifying economic conditions are starting to favor mainly the property owners in various ways. As the different companies are ramping up for some decent growth, it is obvious that some real estate investments should increase in value and this can depend on the location and the type of space that is available. Some of the types of property with different but specific amenities may even be able to attract higher rents. Some of the cities may even be able to see the values of their real estate improve in regards to the commercial estates. This is because, owners of commercial real estate is decreasing the concession that they used to offer to the commercial renters. Higher rent basically means higher revenues against the commercial real estate properties, which makes these as good investment options for the future. 

Foreign buyers have recently spent a huge $82 billion on the U.S. properties. This is in fact a $16 billion increase in the total amount of money from the previous year. This is as per the National Association of Realtors.

The U.S. homes that are there in the recent housing market are less expensive than the foreign properties. Owning property in this country now also offers different rental opportunities for especially the foreign investors.

Interestingly enough, the Canadian buyers still remain as the largest percentage of the foreign buyers, weighing in almost at 23%.  The Canadians have topped this bracket for almost last four years.  The Chinese buyers hold the second highest position at 9% and then India, Mexico and the United Kingdom together hold the third highest position.

Other than this, as per the reports of the National Association of Realtors, the average price paid by the international buyers is at an impressive $315,000. That is about $100K above the U.S. buying average. The top four states for mainly the international buyers are Florida, California, Texas and Arizona.

Other than this, the distressed debt investors are now much more interested in trying out different investment opportunities so that they are able to get the most out f their investments. And in regards to this, the real estate is considered to be a much more safe haven than debt investment.

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Discharge your tax debts by filing for bankruptcy

If you are in distress because of income tax debts, then there is good news for you. You may get your tax debts discharged under Chapter 7 and Chapter 13 of the Bankruptcy Code. In fact, don’t think that bankruptcy is the only option you have got. There are 4 other ways you can take up to get yourself out of income tax debts. Here only the method of bankruptcy is discussed.

How can you discharge your debts?

There are certain requirements you should meet if you want to discharge your tax through bankruptcy. Chapter 7 bankruptcy allows you to fully discharge your debts. However, under Chapter 13 you will be provided with a payment plan that will help you to repay some debts while the rest of your debts will be discharged. The new bankruptcy laws treat tax debts in the same way under both Chapter 7 and Chapter 13 petitions. The five criteria that you have to meet to qualify for your tax debts to be discharged are as follows.

1. Return due date is at least 3 years ago – The tax debt that you want to discharge must be related to a tax return that had a due date of at least 3 years back from the date you file for a bankruptcy. Any extension is included in the due date.
2. The return must be filed at least 2 years ago – Your tax debt should be related to a return that was filed at least 2 years before you file for the bankruptcy. The accurate date is measured from the day you actually filed the return.
3. Tax return is not fraudulent – Your tax return cannot be fraudulent or frivolous for you to qualify for tax debt discharge under bankruptcy. 
4. Tax assessment should be at least 240 days old – Before you file for bankruptcy; the IRS must assess your tax to be at least 240 days old. Usually the assessment of the IRS rises from a self-reported balance due which can be either the final IRS determination in an audit or a proposed assessment by the IRS which has become final.
5. Taxpayer should not be guilty of tax evasion – You cannot be guilty of evading tax laws intentionally.

If you meet the above laws, you can qualify for bankruptcy.

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