Debt-to-Income Ratio Calculator

Debt-to-income ratio (DTI) is the percentage of your gross monthly income that goes toward debt payments. Lenders use it to assess your ability to manage additional debt. A lower DTI means more income available for loan payments, making you a less risky borrower. DTI is often as important as credit score in mortgage qualification.

Most conventional loans require a back-end DTI of 43% or less, though some allow up to 50% with compensating factors (large down payment, excellent credit). FHA loans typically allow up to 57% with strong compensating factors. VA loans are more flexible. The ideal DTI is below 36% — lenders offer better rates to borrowers in this range.

Front-end DTI (housing ratio) is just your proposed housing costs divided by income — lenders want this below 28%. Back-end DTI includes all monthly debt obligations (housing + car + student loans + credit cards) divided by income — lenders typically want this below 43%. Back-end DTI is the primary qualification metric.

You can improve your DTI by increasing your income (adding a co-borrower, side income), paying off existing debts before applying (especially credit cards and car loans), choosing a less expensive home with a lower mortgage payment, or making a larger down payment to reduce the loan amount.