Debt-to-Income Ratio Calculator
Calculate your DTI ratio to understand your borrowing capacity and financial health.
What Is a Debt-to-Income Ratio?
Your debt-to-income (DTI) ratio is the percentage of your gross monthly income that goes toward debt payments. Lenders use DTI to assess your ability to manage monthly payments and repay borrowed money. A lower ratio signals less financial strain. Most mortgage lenders require a DTI below 43%, and the best rates go to borrowers under 36%.
How to Use This Calculator
Enter Your Gross Monthly Income
Use your pre-tax monthly income. Include salary, freelance income, rental income, alimony, and any other regular earnings.
Enter Total Monthly Debt Payments
Add up all recurring debt payments: mortgage or rent, car loans, student loans, credit card minimums, personal loans, child support, and alimony.
Review Your DTI Ratio
The calculator shows your percentage, risk rating, and how much additional debt you could theoretically take on while staying under the 43% threshold.
Key Concepts
Under 36%: Healthy
Lenders view you as low risk. You have the best chance of approval at favorable rates for mortgages, auto loans, and personal loans.
36-43%: Manageable
Most lenders will still approve you, but you may face higher rates. This is the maximum for most qualified mortgages.
43-50%: Stretched
Lending options narrow significantly. Focus on paying down existing debt before taking on new obligations.
Over 50%: Critical
Most lenders will deny new credit applications. Debt relief options like consolidation, management plans, or settlement may be worth exploring.
Expert Insights
Lenders look at two DTI numbers: front-end (housing costs only) and back-end (all debts). The calculator shows back-end DTI, which is the more commonly referenced figure.
If your DTI is above 36%, the fastest way to improve it is increasing income or eliminating a payment entirely (like paying off a small loan) rather than just paying a little extra on each debt.
Your DTI does not include utilities, groceries, insurance premiums, or subscriptions. Even with a "healthy" DTI, make sure your actual cash flow covers all essential expenses.
Frequently Asked Questions
This calculator provides estimates for educational purposes only. Actual results depend on your specific financial situation, lender terms, and market conditions. Consult a qualified financial advisor before making major financial decisions.
Run These Numbers Too
Debt Payoff Calculator
See exactly how long it will take to become debt-free and how much interest you can save with extra payments.
Debt Consolidation Calculator
Compare your current payments to a single consolidated loan and see how much you could save each month.
Mortgage Calculator
Estimate your monthly mortgage payment including principal, interest, taxes, and insurance.
Need Help Managing Your Debt?
A high DTI signals it may be time to explore debt relief. Compare options based on your situation.
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