Question

How much annual income would you need to have if, using the 28/36 ratio, your maximum allowable recurring debt is $380?
a.
$16,290
b.
$22,800
c.
$57,000
d.
$75,000


Please select the best answer from the choices provided

A
B
C
D

Answer 1

A

Using the 28% (front-end) ratio: monthly income = 380 / 0.28 = $1,357.14. Annual income = 1,357.14 × 12 ≈ $16,285.71 ≈ $16,290.