It’s not an uncommon experience: you didn’t close old accounts, avoided unnecessary hard inquiries to your credit report and even made sure you never exceeded 30% of your total credit limit. Your credit score was on fire – you did everything right. And yet, ready to apply for your first mortgage, the lender tells you: you don’t qualify. How could that be?
A lesser-known truth: lenders are usually looking at more than just your credit score when making loan decisions. In fact, your tax-verified income and debt-to-income ratio are often equally important.
Tax-verified income makes sense – a lender would need to know how much money you are bringing in, right? But what the heck is a debt-to-income (or DTI) ratio?
DTI is your total monthly Financial obligations – or debt – divided by your total take-home pay. This includes your rent and any outstanding loans – including student loans. Basically, are you living in your means. We know, yuck.
But knowing how much of your total income is already obligated to something else is really important for lenders to decide whether or not you’ll be able to pay them back. And, if they’re going to use that information, don’t you want to know what it is before they do? (Hint: Yes, you do)
That’s why we created Turbo. It’s a new, free Financial Health app bringing together your verified IRS-filed income, credit score and debt-to-income ratio: the three key numbers that matter to your financial health.
We understand that some of this is new to you, so Turbo also gives you customized advice and insights so you can begin to better understand your financial picture. Whether you are looking to secure a loan, pay for college or buy a house, Turbo provides the tools you need to make the important financial decisions.
Turbo is available today at MyTurbo.com and in the Apple App Store (coming soon to Android in Google Play). And if you are a TurboTax customer, when you finish your taxes this year you can choose to effortlessly transfer your tax return information into Turbo, bringing together your tax & credit report data to give you a more complete picture.
[BTW, you don’t have to be a TurboTax customer to use Turbo]
We are thrilled with our latest sister-app and see it as a perfect compliment to the tools Mint already offers. Mint is how you track your spending, set your budgets and pay your bills on a day-to-day basis, while Turbo gives you a holistic view of your financial health, how you compare to others your age and provides important financial insights.
Give it a try and let us know what you think!
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This year we’re knocking money off the list of taboo subjects! In order to improve the way you manage your finances and build financial confidence, we know how important it is to be able to share and discuss the money troubles we all experience.
Get real about money and start talking about it! Follow @IntuitTurbo on Facebook, Twitter and Instagram and join the conversation. It’s the first step on your journey to financial health!