Debt-to-income ratio is a core number lenders use to assess how much of your income is already committed to debt. This works it out the way lenders actually calculate it.
How it works
DTI
DTI = total monthly debt payments ÷ gross monthly income × 100
Gross income — before tax and other withholding — is the conventional base, the same one the home affordability calculator’s 28/36 rule uses.
Why gross income, not take-home pay
Calculating DTI against take-home pay instead of gross would produce a systematically higher, more alarming-looking ratio than lenders actually use, since take-home pay is always smaller than gross. This isn’t a small detail — using the wrong base changes the number meaningfully.
How to use this calculator
- Add up your total monthly debt payments — loans, minimum credit card payments, not everyday expenses.
- Enter your gross monthly income.
- Read your DTI against commonly cited lending bands.
Frequently asked questions
What’s a “good” DTI?
Roughly under 36% is generally considered healthy by common guidelines; 36–43% is often the practical ceiling many mortgage lenders use; above 43% makes qualifying for many loan types harder. These are guidelines from lending practice, not universal thresholds — actual limits vary by lender and loan type.
Does DTI include my rent or mortgage?
Yes, if you’re currently paying one — housing is typically the largest single component of most people’s DTI.
Should I include utility bills or groceries?
No — DTI conventionally covers debt obligations only (loans, credit cards, other financing), not day-to-day living expenses, even though those are real costs too.
How can I lower my DTI?
Either pay down existing debt or increase income — this calculator shows the ratio itself, not a plan to change it, though the debt snowball and avalanche calculators on this site can help plan the debt-reduction side.
Is DTI the same everywhere, or does it vary by loan type?
The calculation itself (debt ÷ gross income) is standard, but the threshold a given lender treats as acceptable can vary meaningfully by loan type — government-backed loans, for instance, sometimes allow higher DTI than conventional ones.
