PTI Ratio Calculator

Formula

The formula to calculate the PTI Ratio is:

\[ PTI = \frac{MP}{MI} \times 100 \]

Where:

$ PTI $ is the Payment to Income Ratio (%)
$ MP $ is the Monthly Payment ($)
$ MI $ is the Monthly Income ($)

PTI Ratio Definition

The PTI (Payment to Income) Ratio is calculated by dividing the monthly payments by the monthly income, then multiplying by 100. This ratio helps in understanding the proportion of income that goes towards paying off debts or other financial obligations.

Example Calculation

Let's consider an example:

Monthly Payment (MP): $1,500
Monthly Income (MI): $5,000

Using the formula to calculate the PTI Ratio:

\[ PTI = \frac{1500}{5000} \times 100 = 30\% \]

This demonstrates that with a monthly payment of $1,500 and a monthly income of $5,000, the PTI Ratio would be 30%.