What is foir and inir

Question

Accepted Answer

FOIR stands for Fixed Obligation to Income Ratio and INIR stands for Internal Rate of Return.

FOIR is a ratio used by lenders to assess a borrower's repayment capacity based on their fixed obligations compared to their income.
INIR is a financial metric used to calculate the profitability of an investment over time.
FOIR is commonly used in the credit underwriting process to determine a borrower's eligibility for a loan.
INIR is used by investors to evaluate the potential return on an investment.
Example: A borrower with a FOIR of 40% means that 40% of their income goes towards fixed obligations like loan repayments.
Example: An INIR of 10% indicates the annual return on an investment.

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