How to use the DTI calculator
- Enter your gross monthly income — before taxes and deductions. For a salary, divide the annual amount by 12.
- Enter your housing payment: rent, or your mortgage payment including property tax, insurance and HOA dues.
- Add your other minimum monthly debt payments: car loans, student loans, credit cards and other loans.
- See your DTI, your front-end and back-end ratios and how much room you have.
How to calculate debt-to-income ratio
Example: with a $6,000 monthly income and debts of $1,500 (housing) + $400 (car) + $300 (student loans) + $100 (credit cards) = $2,300, your DTI is 2,300 ÷ 6,000 = 38.3%. Your front-end ratio (housing only) is 1,500 ÷ 6,000 = 25%.
What is a good debt-to-income ratio?
| DTI | What it means |
|---|---|
| 36% or less | Healthy. You should qualify for most loans at good rates. |
| 37%–43% | Acceptable for many mortgages, but lenders look more closely at credit and savings. |
| 44%–50% | High. Some FHA and other government-backed loans may still approve with strong compensating factors. |
| Over 50% | Very high. Most lenders will decline, and your budget has little room for emergencies. |
Front-end vs. back-end DTI
The front-end ratio counts only housing costs; the classic limit is 28%. The back-end ratio counts all monthly debts; the classic limit is 36%, and many mortgage programs allow 43% or more. Lenders usually look at both — the home affordability calculator uses them to estimate how much house you can buy.
What counts as debt?
- Included: rent or mortgage, car loans, student loans, minimum credit card payments, personal loans, child support and alimony.
- Not included: utilities, groceries, insurance premiums (other than homeowners), phone bills, subscriptions and taxes.
How to lower your DTI
- Pay down credit cards and small loans first — eliminating a payment entirely helps the most.
- Avoid new debt before applying for a mortgage.
- Refinance high-interest debt into a lower monthly payment.
- Increase your documented income, for example with a co-borrower.
Frequently asked questions
What is a good debt-to-income ratio?
A DTI of 36% or less is generally considered good. Many mortgage lenders accept up to 43%, and some government-backed programs go up to about 50% with strong credit or savings.
How do I calculate my debt-to-income ratio?
Add up your minimum monthly debt payments, divide by your gross monthly income and multiply by 100. $2,000 of debts on a $5,000 income is a 40% DTI.
Does rent count in debt-to-income ratio?
For a mortgage application, your future mortgage payment replaces your rent in the calculation. For other loans, lenders often include your current rent or housing payment.
Is DTI based on gross or net income?
Lenders use gross income — what you earn before taxes and deductions.
Do utilities count toward DTI?
No. Utilities, groceries, phone bills and similar living expenses are not debts and are not included in the ratio.
Results are estimates for educational purposes and are not financial advice. Actual loan terms, rates, taxes and fees vary by lender and location — confirm figures with a qualified professional before making decisions.
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