Simply put, the debt to income ratio is a measurement of how much of your monthly income goes towards paying down the debts you have incurred. To calculate your ratio, add up your monthly debt payments and divide the total by your gross monthly income or for a consultation on what your financial picture is contact a Montreal bankruptcy trustees.
For decades, banks have used the debt-to-income ratio as part of their approval process for a home loan. If you have already been searching the Internet for information on dealing with debt and the threat of declaring bankruptcy in Montreal, you know some experts maintain ratios in the mid 30% range are generally safe, while ratios in the 40’s are cause for concern. A debt to income ratio of 50% or more is a warning sign of severe financial trouble looming on the horizon and an alarm bell to get a Montreal bankruptcy trustees debt advice.
However, if you go beyond the first few hits you get on your search list, you will see that since the financial crisis, there are now experts out there who say to be truly safe, you should keep your debt to income ratio at 20% or less, this you can go over with a Montreal bankruptcy trustees help.
It reflects a cautionary outlook on the future of industrialized economies. In our society, the income gap between the “haves” and the “have-nots” is growing wider. A Montreal bankruptcy trustees can help you assess your present financial situation.
Montreal residents who are truly interested in safeguarding their financial futures may want to rethink what they see as warning signs of financial trouble. In 2010, household debt in Canada reached record levels, surpassing that of our neighbors to the south. In the past, the warning signs we were told to watch for had to do with how we managed our own money and for the most part this was the general view point of many Montreal bankruptcy trustees.
While those signs are still relevant to most Montreal bankruptcy trustees, today we have to be more concerned than ever with the stability of our income, and the lack of income growth.
Many people who end up declaring bankruptcy are forced to do so because of income loss. However, not all Montreal residents who lose their jobs end up in bankruptcy. The difference is too much debt and too little savings. Debt brings us to the edge of financial disaster and many Montreal bankruptcy trustees agree that unmanageable debt and no safety cushion is a good reason to seek their council.
If you are truly concerned about your financial future, then contact one of the Montreal bankruptcy trustees listed here.