The Debt-to-Income (DTI) Ratio Calculator works out your front-end and back-end debt-to-income ratios, which lenders use to decide how much you can borrow.
Your debt-to-income ratio is 33.00%. That is considered good.
| Front-end ratio (housing ÷ income) | 24.00% |
| Back-end ratio (all debts ÷ income) | 33.00% |
| Monthly income | $5,000.00 |
| Monthly housing costs | $1,200.00 |
| Monthly other debts | $450.00 |
Your debt-to-income ratio (DTI) compares how much you owe each month with how much you earn before tax. It is one of the main numbers lenders use, together with your credit score, to decide whether to lend to you and how much.
The front-end ratio counts only housing costs (rent or mortgage, property tax, insurance and HOA fees). The back-end ratio counts housing plus all other debt payments: cards, car loans, student loans and so on. Everyday living costs such as food and utilities are not included.
Worked example (defaults): $60,000 a year is $5,000 a month. Rent of $1,200 gives a front-end ratio of 24%. Adding $200 of card payments and a $250 car loan gives $1,650 and a back-end ratio of 33%.
A common guideline for conventional mortgages is the 28/36 rule: housing at most 28% and all debt at most 36% of income. Qualified mortgages are generally capped at 43% back-end. FHA loans may allow 31/43 or higher with strong compensating factors. Below 36% is considered healthy; above 50% is a warning sign.
Pay down or pay off small debts, avoid new borrowing before applying for a mortgage, refinance to lower payments, or increase income. Paying off a debt with a few payments left removes it from the calculation entirely.
Does DTI affect my credit score? No, but the debts themselves do.
Is DTI calculated on gross or net income? Gross, before tax.
Is rent counted after buying a house? No, the new mortgage payment replaces it.