Residual Income


Residual Income
The amount of income that an individual has after all personal debts, including the mortgage, have been paid. This calculation is usually made on a monthly basis, after the monthly bills and debts are paid. Also, when a mortgage has been paid off in its entirety, the income that individual had been putting toward the mortgage becomes residual income.

Residual income is often an important component of securing a loan. The loaning institution usually assesses the amount of residual income an individual has left after paying off other debts each month. If the individual requesting the loan has sufficient residual income to take on additional debt, the loaning institution will be more likely to grant the loan because having an adequate amount of residual income will ensure that the borrower has sufficient funds to make the loan payment each month.


Investment dictionary. . 2012.

Look at other dictionaries:

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  • residual income — residual return The net income that a subsidiary undertaking or division of an organization generates after being charged a percentage return for the book value of the net assets or resources deemed to be under its control. The headquarters or… …   Big dictionary of business and management

  • Остаточная прибыль (RESIDUAL INCOME)  — Средство измерения результатов деятельности центра инвестиций, которое фокусируется на ответственности за получение прибыли и на эффективности финансового управления, проводимого руководителем центра инвестиций.  Остаточная прибыль обычно… …   Словарь терминов по управленческому учету

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  • residual — re|sid|u|al [rıˈzıdʒuəl] adj [only before noun] formal remaining after a process, event etc is finished ▪ the residual effects of drug treatment residual income (=the money left from what you earn after you have paid your taxes) …   Dictionary of contemporary English

  • residual — adjective (only before noun) formal remaining after a process, event etc is finished: There was still some residual unrest after the rebellion had been crushed. | residual income (=the money left from what you earn after you have paid your taxes) …   Longman dictionary of contemporary English