What the debt-to-income calculator tells you
Debt-to-income ratio (DTI) is the percentage of your gross monthly income that goes toward debt payments. Lenders use it as the primary test of whether you can handle a new mortgage, so it’s often the number that makes or breaks an approval.
There are two versions. Front-end DTI counts only your housing payment against income; back-end DTI counts all recurring debt — housing plus car loans, student loans, credit-card minimums, and child support. This tool computes both and flags them against the common 28% front-end and 43% back-end thresholds.
Checking your DTI before you write an offer — including on an off-market Miami home — tells you whether you’re ready to qualify or need to pay down a balance first.
How it works
- Convert income to a gross monthly figure if you entered it annually.
- Front-end DTI = housing payment ÷ gross monthly income.
- Back-end DTI = (housing payment + all other monthly debt payments) ÷ gross monthly income.
- Each ratio is compared to its guideline — 28% front-end and 43% back-end — and flagged green or over the limit.
- Adjust the housing payment or pay down a debt and watch each ratio move below the line.
Frequently asked questions
What is a good debt-to-income ratio?
Lower is better. A back-end DTI under 36% is considered strong, up to about 43% is acceptable for most conventional loans, and some programs allow up to 50% with strong compensating factors. Front-end (housing only) is typically kept at or below 28%.
How do I calculate my DTI?
Add up your monthly debt payments — the new housing payment plus car loans, student loans, minimum credit-card payments, and similar — then divide by your gross (pre-tax) monthly income. For example, $3,000 in debts on $9,000 of income is a 33% back-end DTI.
What DTI do you need to qualify for a mortgage?
Many conventional loans cap back-end DTI around 43%, though automated underwriting sometimes approves higher with reserves or a high credit score. FHA loans can allow higher ratios. Staying under 43% gives you the widest set of options and better pricing.
Does rent count in debt-to-income?
Your current rent is generally not counted in DTI for a purchase, because the new mortgage payment replaces it. Lenders use the proposed housing payment instead. Recurring obligations like car loans, student loans, and credit-card minimums do count in the back-end ratio.
How can I lower my DTI to get approved?
Pay down or pay off revolving balances, avoid taking on new loans before closing, and consider a larger down payment to shrink the housing payment. Increasing documented income — a raise, bonus, or co-borrower — also lowers the ratio. Small changes can move you under the 43% line.
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