Debt-to-Income (DTI) Ratio Calculator
Calculate your debt-to-income ratio using gross monthly income and monthly debt payments. See how close you are to the 43% mortgage threshold.
Healthy (<36%): Most lenders see this as a manageable level of debt.
Caution (36-43%): You may still qualify for a mortgage, but lenders may look closer.
High (≥43%): This is the limit for many "Qualified Mortgages." You may struggle to get approved.
Understanding the Debt-to-Income (DTI) ratio
Your debt-to-income (DTI) ratio is a simple percentage that compares how much money you earn each month to how much you pay out in debt obligations. Lenders use this number to measure your ability to manage monthly payments and repay the money you plan to borrow.
There are two types of DTI. The "front-end" ratio includes only your housing costs. The "back-end" ratio—which this calculator focuses on—includes all of your recurring monthly debts. This gives a more complete picture of your financial flexibility.
How to improve your DTI
There are only two ways to lower your DTI: increase your gross monthly income or decrease your monthly debt payments. Because increasing income can be difficult in the short term, many people focus on paying down high-interest credit card balances or consolidating loans to lower their required monthly minimums before applying for a mortgage.