Disposable income
Credit scores & reportsThe money left after paying essential bills and expenses.
Overview
Lenders use disposable income to judge repayment capacity.
It is calculated from income minus regular costs.
Why it matters
- It influences affordability decisions.
- Low disposable income can reduce borrowing limits.
- It helps set realistic repayment plans.
FAQs
Is disposable income the same as savings?
No. It is the money left each month after essentials.
How do lenders estimate disposable income?
They review income and spending from bank statements.
Related terms
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