Rule 20
Total consumer non collateral debt should not exceed 20% of net monthly income.
Rule 28
Total collateral debt should not exceed 28% of net monthly income.
Rule 36
Total debt should not exceed 36% of net monthly income.
There is a high incident of default when debt exceeds any of these limits, and most always when debt exceeds Rule 36 limits.
Alan Friedberg – 5/7/2019