Debt-to-Income Ratio Calculator
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Your debt-to-income ratio (DTI) is your monthly debt payments divided by your monthly gross income. With $6,000 a month before tax and $2,250 in debt payments, your DTI is 37.5%. Lenders use it to judge how much more debt you can handle.
Type the problems from this lesson and check each step.
Yearly salary ÷ 12. Include steady side income you can document.
| Ratios | |
| Back-end DTI (all debts) | 37.5% |
| Front-end DTI (housing only) | 25% |
| Monthly amounts | |
| Gross monthly income | $6,000.00 |
| Housing | $1,500.00 |
| Other debt payments | $750.00 |
| Total debt payments | $2,250.00 |
| Room left | |
| Extra payment room at 36% | over by $90.00 |
| Extra payment room at 43% | $330.00 |
Show steps
- Total debt = $1,500.00 + $750.00 = $2,250.00.
- Back-end DTI = $2,250.00 ÷ $6,000.00 × 100 = 37.5%.
- Front-end DTI = $1,500.00 ÷ $6,000.00 × 100 = 25%.
How to use the DTI calculator
- Enter your gross monthly income: pay before taxes and deductions.
- Enter your monthly housing payment and the minimum monthly payment on each other debt.
- Press Calculate to see your back-end and front-end DTI and how much room you have below 36% and 43%.
DTI formula
- Back-end DTI = all monthly debt payments ÷ gross monthly income × 100
- Front-end DTI = monthly housing payment ÷ gross monthly income × 100
Example: income $6,000; housing $1,500; car $400; student loan $250; cards $100. Total debts $2,250. Back-end DTI = 2,250 ÷ 6,000 = 37.5%. Front-end DTI = 1,500 ÷ 6,000 = 25%.
What counts as debt
| Include | Leave out |
|---|---|
| Rent or mortgage payment, with property tax, insurance and HOA dues | Groceries, utilities, phone and internet |
| Car, student and personal loan payments | Car insurance and health insurance |
| Minimum credit card payments | Taxes taken from your paycheck |
| Child support or alimony you pay | Savings and retirement contributions |
What is a good DTI?
Lower is better. Many lenders like to see a back-end DTI of 36% or less. The Consumer Financial Protection Bureau notes that 43% is often the highest DTI a borrower can have and still get a qualified mortgage, though some loan programs allow more. Front-end limits of about 28% to 31% are common guides for housing costs.
To lower your DTI, pay down debts with the highest payments, avoid new loans before you apply, or add documented income.
Debt-to-income practice questions
Test yourself with 6 multiple-choice questions. Choose an answer and press Submit to see if you are right and why. Your score appears at the end.
Quiz complete
Frequently asked questions
How do you calculate debt-to-income ratio?
Add up your monthly debt payments, divide by your monthly income before taxes, and multiply by 100. $2,000 ÷ $5,000 = 40%.
What is a good debt-to-income ratio?
Many lenders prefer 36% or less. 43% is a common upper limit for many mortgages, and some programs allow more with strong credit or savings.
Does rent count in DTI?
Yes, your current rent counts as a housing payment. When you apply for a mortgage, the lender uses the new house payment instead.
Does DTI affect my credit score?
No. Credit scores do not use income, so DTI is not part of them. Lenders look at it separately, along with your credit report.
Sources
- Consumer Financial Protection Bureau: What is a debt-to-income ratio?
- Consumer Financial Protection Bureau: Debt-to-income calculator worksheet
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