Debt-to-Income Ratio Calculator
Assess your borrowing capacity in seconds. Calculate the percentage of your gross monthly income consumed by debt payments to understand your financial health.
Include: mortgage, car loans, credit cards, student loans, etc.
Results
Enter values and click Calculate to see results
How to Use This DTI Calculator
Enter your gross monthly income
Include all income sources before taxes: salary, bonuses, rental income, child support, and any other regular income.
Add up all monthly debt payments
Include mortgage or rent, car loans, student loans, credit card minimums, personal loans, and alimony. Don't include utilities or groceries.
Click Calculate to see your DTI ratio
The result shows your debt-to-income percentage, remaining income, and an assessment of your debt level.
DTI Ratio Guidelines
| DTI Range | Status | Mortgage Approval | Recommendation |
|---|---|---|---|
| Below 20% | Excellent | Easily approved | Great financial position |
| 20% - 36% | Good | Well qualified | Healthy debt level |
| 36% - 43% | Fair | May qualify | Consider paying down debt |
| 43% - 50% | High | Limited options | Reduce debt before borrowing |
| Above 50% | Very High | Unlikely to qualify | Prioritize debt reduction |
Most lenders prefer DTI below 43% for qualified mortgages. FHA loans may allow up to 50% with compensating factors.
Understanding Debt-to-Income Ratio
What Is DTI?
Debt-to-income ratio compares your monthly debt payments to your gross monthly income. It shows what percentage of your income goes toward debt before any other expenses. Lenders use DTI to assess whether you can handle additional debt.
Front-End vs Back-End DTI
Front-end DTI includes only housing costs (mortgage, taxes, insurance). Back-end DTI includes all debts. Lenders typically look at back-end DTI. Conventional loans often want front-end below 28% and back-end below 36%.
What Counts as Debt?
Include: mortgage/rent, car payments, student loans, credit card minimums, personal loans, child support, and alimony. Exclude: utilities, groceries, insurance premiums, entertainment, and credit cards you pay in full monthly.
Why DTI Matters
High DTI means less money for emergencies, savings, and unexpected expenses. Lenders see this as risk. Even if you have good credit, high DTI can deny loans or trigger higher interest rates.
Tips to Improve Your DTI
Pay Down Credit Cards
Reducing credit card balances lowers minimum payments. Paying $5,000 on a card might drop the minimum from $150 to $50, improving DTI by that amount monthly.
Increase Your Income
Ask for a raise, take on overtime, start a side gig, or monetize a skill. Higher income improves DTI without paying down debt. Lenders typically want 2 years of consistent income.
Avoid New Debt Before Applying
Don't finance a car or open credit cards before applying for a mortgage. New debt increases DTI and can kill loan approval even after pre-approval.
Consider Debt Consolidation
Consolidating high-interest debt into a lower-payment loan can reduce monthly obligations. Be careful — extending terms may cost more long-term even with lower payments.
Frequently Asked Questions
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