Loan officers are accustomed to working with debt-to-income ratio and are well-aware of its implications and effects on their clients' loan statuses. But can a debt-to-income ratio help you fund more loans or obtain more favorable rates and terms for you customers?

The answer, in a word: absolutely.

How can I calculate the debt-to-credit ratio?

To calculate the ratio, simply divide the current balances on people's revolving lines by the credit card limits. Credit-card balances can vary widely, which can affect credit scores dramatically. The ratio only pertains to revolving debt, usually credit cards - though recent industry speculation is that it is factored into home-equity lines of credit.

How does it affect my client's scores?

As a general rule, clients are in good shape if they use less than 30 percent of their available credit. A 30 percent to 50 percent debt-to-credit ratio usually will see a drop of 10 to 20 plus points. From 50 to 70 percent, we have seen an average drop of approximately 30 to 50 points. Any ratio higher than 70 percent significantly diminishes scores to the tune of about 70 to 100 points.

Average U.S. consumers use 24 percent of their available credit, which does not affect their credit negatively. According to a recent Experian Consumer Direct study, 16 percent of consumers are using more than 50 percent, which definitely can have a negative affect on their scores.

We have even seen clients with otherwise "clean" credit and no negative information on their files watch their credit ratings plummet down from an "A" to a "D" or even an "F" file rating because they "maxed out" their credit cards. Worse, some might be over their credit limits. According to the study, those with higher debt-to-credit ratios carry an average of 4.6 credit cards, with the national average being 3.2 cards.

How can I help my clients with high ratios?

This may be the hard part.