Debt-to-Income (DTI) Ratio Calculator

Understanding DTI (Debt-to-Income): What Lenders Look At

Your Debt-to-Income (DTI) ratio compares what you pay toward debt each month with your gross monthly income (income before tax). It’s a quick way to gauge how stretched your budget may be. Lenders often consider DTI when reviewing applications—alongside your credit history, income stability, and other factors. While every lender has its own policy, a lower DTI generally makes it easier to pass affordability checks.

There are two common flavors of DTI. Front-end DTI looks only at housing costs (rent or mortgage and, where relevant, property tax/HOA/insurance). Back-end DTI includes housing plus your other monthly debt payments, such as car loans, student loans, personal loans, buy-now-pay-later instalments, and the minimums you owe on credit cards. This calculator shows both, so you can see how housing choices and other debts interact.

Interpreting your result requires context. As a friendly rule of thumb, many people aim to keep housing below a third of gross income, and total debts below the mid-30% range. That said, thresholds vary by country, lender, and individual circumstances. A household with very stable income and low living costs may be comfortable with a higher ratio; another with variable income or upcoming expenses may prefer a more conservative target. Use the results as a conversation starter—not a pass/fail verdict.

Ways to improve your DTI

• Reduce payments: Pay down revolving balances, refinance at a lower rate, or consolidate to a structured loan (if it lowers total cost).
• Avoid new debt: Press pause on discretionary borrowing until your DTI moves in a direction you like.
• Increase income: Overtime, a side project, or negotiating pay can move the denominator in your favor.
• Right-size housing: If front-end DTI is doing the heavy lifting, consider ways to reduce housing costs.

Informational only — not financial advice. Lender criteria and definitions vary.