Debt-to-Income Ratio Calculator - DTI Calculator for Mortgage & Loans
Free debt-to-income ratio calculator to calculate your DTI ratio for mortgage qualification and loan applications.
Determine your financial health by analyzing monthly debt payments versus gross income with detailed breakdown.
Understand lender requirements and improve your chances of loan approval with accurate DTI calculations.
Monthly Debt Payments
How to Use the DTI Calculator
Enter your gross monthly income (before taxes and deductions)
Add all monthly debt payments (mortgage/rent, car loans, student loans, credit cards)
Include minimum credit card payments and other regular debt obligations
Add child support or alimony payments if applicable
Include any other recurring monthly debt obligations
Click 'Calculate DTI' to see your debt-to-income ratio
Compare your DTI against lender requirements and recommended ranges
Review the detailed analysis and recommendations for improvement
Key Features of Our DTI Calculator
Real DTI Ratio Examples
First-Time Homebuyer
Gross income: $6,000/month | Proposed mortgage: $1,400 | Other debts: $450/month
High Debt Household
Gross income: $8,500/month | Current mortgage: $2,200 | Other debts: $1,800/month
Student Loan Heavy Profile
Gross income: $5,000/month | Rent: $1,200 | Student loans: $600 | Credit cards: $200
Self-Employed Applicant
Gross income: $7,000/month | Current mortgage: $1,800 | Business loan: $400 | Car payment: $350
High Earner with High Debt
Gross income: $15,000/month | Mortgage: $4,000 | Other debts: $2,500/month
DTI Calculator Use Cases
Mortgage Pre-qualification
Determine if you qualify for a mortgage before applying. Calculate your DTI ratio to understand how much house you can afford and what lenders will consider.
Loan Application Planning
Plan for car loans, personal loans, or other financing by understanding how new payments will affect your DTI ratio and loan eligibility.
Debt Management Strategy
Create a debt reduction plan to improve your DTI ratio for better loan terms and increased borrowing capacity in the future.
Financial Health Assessment
Evaluate your overall financial health by understanding the relationship between your debt obligations and income, and identify areas for improvement.
Refinancing Preparation
Prepare for mortgage refinancing by optimizing your DTI ratio to qualify for better interest rates and loan terms.
Understanding Debt-to-Income Ratio (DTI)
Debt-to-Income (DTI) ratio is a crucial financial metric that lenders use to assess your ability to manage monthly payments and repay debts. It's calculated by dividing your total monthly debt payments by your gross monthly income and expressing it as a percentage. Lenders typically look at two types of DTI: front-end ratio (housing-related expenses only) and back-end ratio (all debt obligations).
Front-end DTI, also called the housing ratio, includes only your proposed mortgage payment (principal, interest, taxes, and insurance), homeowner's association fees, and mortgage insurance. Most conventional lenders prefer a front-end DTI of 28% or less, though some programs allow up to 35-40%. This ratio shows whether you can comfortably afford your housing payment.
Back-end DTI includes all monthly debt obligations: mortgage/rent, car payments, student loans, credit card minimums, personal loans, child support, and alimony. Conventional lenders typically prefer a back-end DTI of 36% or less, though some government-backed loans allow up to 43-50%. A lower DTI indicates better financial health and increases your chances of loan approval with favorable terms.
Common DTI Mistakes and Tips
Mistake
Using net income instead of gross income
Tip
Always use gross (pre-tax) income for DTI calculations, as this is what lenders use. Don't subtract taxes, insurance, or other deductions from your income.
Mistake
Forgetting to include all minimum credit card payments
Tip
Include the minimum payment for all credit cards, even if you pay more. Lenders consider the minimum required payment as your monthly obligation.
Mistake
Not including recurring debts like alimony or child support
Tip
Include all legally obligated recurring payments, including child support, alimony, and court-ordered payments, as they affect your borrowing capacity.
Mistake
Counting business expenses as personal debt
Tip
Business expenses and payments should not be included in personal DTI calculations. Use only personal debt obligations in your calculation.
Mistake
Ignoring the impact of proposed new loans
Tip
When applying for new credit, include the proposed payment in your DTI calculation to ensure you'll still be within acceptable ratios after the new debt.
Mistake
Not considering spouse income for joint applications
Tip
For joint loan applications, include both incomes and all debts from both applicants. This may improve your DTI ratio if one spouse has significantly lower debt.
DTI Calculator Frequently Asked Questions
What's considered a good DTI ratio?
Generally, a DTI below 36% is considered good, with 28% or less for housing costs. DTI between 36-43% is acceptable for many loans, while above 43% may limit borrowing options.
Can I get a mortgage with a high DTI ratio?
It's possible with compensating factors like high credit score, large down payment, or substantial cash reserves. Some government-backed loans allow DTI up to 50% with strong qualifications.
How can I lower my DTI ratio?
Increase your income, pay down existing debts, consolidate debts to lower monthly payments, avoid new debt, and consider refinancing high-interest loans to reduce monthly payments.
Do lenders use gross or net income for DTI?
Lenders always use gross (pre-tax) income for DTI calculations. They don't consider taxes, health insurance, or other deductions when calculating your qualifying income.
What's included in the front-end DTI ratio?
Front-end DTI includes only housing-related expenses: mortgage principal and interest, property taxes, homeowner's insurance, mortgage insurance, and HOA fees.
How does DTI affect credit score?
DTI doesn't directly affect your credit score, but high DTI may lead to missed payments, which does impact your score. Lenders consider both when evaluating loan applications.
Is rent included in DTI calculations?
Yes, rent is included in DTI calculations for loan applications. It's treated as a housing obligation similar to a mortgage payment in the front-end ratio calculation.
Can I exclude student loans in deferment from DTI?
Most lenders include deferred student loans in DTI calculations, typically using 1-5% of the balance as a payment amount. Some government programs may exclude deferred loans.