Debt-to-Income (DTI) Ratio Calculator
Calculate your debt-to-income ratio to see if you qualify for a mortgage or loan.
How to use this tool
- Enter total monthly debt payments and gross monthly income in the fields above.
- Results update instantly as you type — or click Calculate.
- Read your debt-to-income ratio and the full breakdown beneath it.
Lenders use DTI to evaluate loan applications. A DTI below 36% is generally considered good; most lenders cap at 43%.
⚠ This tool provides general estimates for education only and is not financial, tax or legal advice. Figures may not reflect your situation — verify with a qualified professional.
Formula
DTI (%) = (Total Monthly Debt Payments ÷ Gross Monthly Income) × 100
How it works
The debt-to-income ratio expresses monthly debt obligations as a percentage of pre-tax monthly income, and is the primary metric lenders use to assess loan affordability. A DTI at or below 36% is generally considered healthy, while most mortgage lenders cap approval at 43–50%. This calculator uses gross (pre-tax) income as the denominator, consistent with standard lending practice; if gross income is zero the result is returned as 0% to avoid division by zero.
Worked example
- Monthly debt payments = $1,500; Gross monthly income = $5,000.
- DTI = ($1,500 ÷ $5,000) × 100 = 30%.
Debt-to-Income Ratio: 30%
Common mistakes to avoid
- Including utility bills and grocery spending as debt payments -- DTI counts only recurring loan and lease obligations, not general living expenses.
- Using net (after-tax) income instead of gross income, which overstates DTI and makes the ratio look worse than lenders calculate it.
- Omitting the proposed new mortgage payment from the front-end DTI when evaluating home loan eligibility, understating the ratio lenders will see.
Key terms
- Debt-to-Income Ratio (DTI)
- The percentage of gross monthly income consumed by monthly debt payments; a key metric for loan qualification.
- Gross monthly income
- Total income before taxes and other deductions — the figure lenders use as the DTI denominator.
- Monthly debt payments
- The sum of all required monthly payments: mortgage or rent, car loans, student loans, credit card minimums, and other recurring debts.
- Front-end ratio
- A narrower DTI variant that counts only housing costs (mortgage principal, interest, taxes, and insurance) as a share of income.
- Back-end ratio
- The full DTI including all monthly debt obligations, not just housing — the figure most commonly referred to as 'DTI' by lenders.
Frequently asked questions
- What is a good debt-to-income ratio?
- A DTI below 36% is considered good by most lenders. For a qualified mortgage, your DTI must generally be 43% or below. Below 20% is excellent.
- What debts are included in DTI?
- Include all recurring monthly debt obligations: mortgage/rent, car loans, student loans, credit card minimum payments, personal loans, and any other monthly debt commitments. Do not include utilities, groceries, or discretionary spending.