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Calculating Your Debt-to-Income Ratio

Know Your Debt-to-Income Ratio for Smarter Financial Decisions

UnionBank of the Philippines
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UnionBank of the Philippines

Your debt-to-income ratio measures how much debt you can handle based on your income. A high ratio may affect loan approvals and interest rates.

Your debt-to-income ratio helps determine how much debt you can handle. This is calculated by comparing your net income to the amount of debt you have.

Here's an example: 


Based on the above, your debt-to-income ratio is 25%. Typically, a ratio exceeding 40% indicates excessive debt. In such cases, you may be denied further credit or you may need to pay a higher interest rate for new debt.
Here's another example:


In this example, total credit card debt is P40,000, making your debt-to-income ratio 80%. There is a big chance that your application for loans or a credit limit increase may be declined.
Download the UnionBank Online App now to better manage your finances and get access to the following anytime, anywhere:
1. Check your balances, transactions, and available credit limit at a glance.
2. Access your statement of account.
3. Instantly pay off your credit card balance and refresh your credit limit real-time.
4. Redeem your rewards.
Download now!
Simply search for UnionBank Online at the Apple App Store, Google Play Store, and Huawei AppGallery and tap download.

PRESS CONTACT

Metro Manila (+632) 8841-8600
PLDT domestic toll free 1-800-1888-2277
International toll-free (IAC) + 800-8277-2273
Head Office Address UnionBank Plaza Bldg., Meralco Ave. corner Onyx St., Ortigas Center, Pasig City, Philippines

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