Debt-to-Income Ratio Calculator
Your debt-to-income (DTI) ratio is one of the most important numbers lenders look at when you apply for a mortgage or loan. Calculate yours instantly and see how it compares to lender thresholds for approval.
This calculator provides estimates for general informational purposes only and does not constitute financial advice. Consult a qualified financial professional before making any financial decisions.
How It Works
DTI ratio measures what percentage of your gross monthly income goes toward debt payments. Lenders use two versions:
Front-end DTI (housing ratio): Monthly housing payment ÷ Gross monthly income
Back-end DTI (total debt ratio): All monthly debt payments ÷ Gross monthly income
"Debt payments" include: mortgage/rent, car loans, student loans, credit card minimums, personal loans, and any other recurring debt obligations. They do NOT include utilities, groceries, insurance, or 401(k) contributions.
"Gross income" is before taxes — your salary/wages plus any regular self-employment income, rental income, or other documented income.
Worked example:
Gross monthly income: $6,000
Monthly debts: $400 car, $200 student loans, $100 credit card minimums = $700/mo
Housing payment (proposed): $1,500/mo
Front-end DTI = $1,500 / $6,000 = 25%
Back-end DTI = ($700 + $1,500) / $6,000 = 36.7%
Lender thresholds:
- Conventional mortgages typically require back-end DTI ≤ 43–45%
- FHA loans may allow up to 50% with compensating factors
- Best rates and approvals typically go to borrowers with DTI below 36%
Frequently Asked Questions
What DTI do I need for a mortgage?
Most conventional lenders prefer a back-end DTI below 43%. FHA loans allow up to 50% with strong compensating factors (large down payment, excellent credit). The Qualified Mortgage (QM) rule caps DTI at 43% for most loans. To get the best rates, aim for under 36%.
What counts as debt in DTI?
Monthly minimum payments on: mortgage or rent, car loans, student loans, credit card minimums, personal loans, child support, alimony, and any other installment debt that appears on your credit report. Does NOT include utilities, groceries, subscriptions, or insurance.
What is the difference between front-end and back-end DTI?
Front-end DTI (also called the housing ratio) is just the proposed housing payment divided by income. Back-end DTI includes all monthly debt payments. Mortgage lenders typically focus on back-end DTI, but some also check that the front-end ratio stays below 28–31%.
How can I lower my DTI?
You can lower DTI by increasing income (raise, side income) or reducing debt payments (pay off balances, avoid new debt). Paying off a car loan or small credit card before applying for a mortgage can meaningfully reduce your back-end DTI.
Does my DTI affect my interest rate?
DTI primarily affects approval, not rate. However, very high DTI may push you into riskier loan products with higher rates. Credit score affects rate more directly. Some lenders use a combination of DTI and credit score to determine rate tiers.