- November 10, 2014
- Posted by: Brian Poncelet
- Category: Approved, Disability Insurance, Federal Politics, Hollywood, Life Insurance, World News Insurance
What is the TDS and what does it mean?
A debt service measure that financial lenders use as a rule of thumb to give a preliminary assessment of whether a potential borrower is already in too much debt. More specifically, this ratio shows the proportion of gross income that is already spent on housing-related and other similar payments. The upper limit is 40%.
Here is is : Mortgage payment + Property Taxes + Heating + lines of credit + other debt
Note: Let’s say you have a line of credit for $100,000 (zero balance) the bank will look at that and assume you will use it.
So $100,000 X 3% = $3,000 is what you will pay per year.