Question

Jonathan just graduated college and can expect monthly loan payments of $405. His new job provides him

with an annual salary of $36,000. What is his debt‐to‐income ratio? What is the acceptable debt‐to‐

income range for student loans and does Jonathan’s fall within that range?

Answer 1

36000/12=3000

so 3000 a month he makes.

3000-405=2,595

405x12= 4860

Answer 2

Jonathan just graduated college and can expect monthly loan payments of $405. His new job provides him with an annual salary of $36,000. What is his debt‐to‐income ratio?

If Jonathan's monthly loan payment is $405 that that's is only debt, solve to find his monthly income first.

$36,000/12 = $3,000 Jonathan's debt to income ratio is $405 (debt)/ $3,000 (income).

The debt to income ratio is solved by dividing your monthly expenses by your monthly income $405/$3,000 = 7.41% is Jonathan's debt to income.

What is the acceptable debt‐to‐income range for student loans and does Jonathan’s fall within that range? This seems like a fairly low debt to income ratio for students loans because it only takes up a small percentage of Jonathan's monthly income.