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DTI Calculator

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The debt-to-income ratio (DTI) is the number lenders use to judge how much of your gross income already goes to debt. Enter your total monthly debt payments and your gross monthly income, and this calculator returns your DTI as a percentage with an instant rating, from excellent to very high. The same numbers work for any currency, since the ratio only depends on the proportion between the two values.

How the DTI is calculated

  1. 1

    Enter your monthly debt payments

    Add up everything you pay each month: mortgage or rent, car loans, student loans, credit card minimums, personal loans, child support or alimony paid out.

  2. 2

    Enter your gross monthly income

    Pre-tax income from all stable sources: salary, self-employment net, verified bonus, alimony and child support received.

  3. 3

    Read your DTI and rating

    The tool divides total debt by gross income, shows the result as a percentage and assigns a rating: excellent, good, high or very high.

The formula

DTI = total monthly debt payments ÷ gross monthly income × 100

Example: 1,500 of monthly debt against 6,000 of gross income gives 1,500 ÷ 6,000 × 100 = 25 %.

Rating bands

DTI Rating
20 % or less Excellent
21-35 % Good
36-43 % High
Above 43 % Very high

What to count as debt

  • Mortgage or rent, car loans, student loans, credit card minimums (even if you pay the balance in full), personal loans, child support and alimony paid out.
  • Leave out utilities, groceries, insurance premiums and subscriptions: lenders do not count them.

What to count as income

  • Salary before taxes, not take-home pay.
  • Self-employment income averaged over recent tax returns.
  • Verified bonus and overtime, rental income and documented alimony or child support.
  • Leave out one-time windfalls, unverified side income and expected raises.

Why lenders watch DTI

Conventional loans typically cap the ratio around 43-45 %, FHA around 43 % and VA loans higher, because these are the figures lenders reuse from your application. A ratio above a cap is not an automatic denial: lenders weigh compensating factors such as cash reserves, credit score and employment stability.

How to improve a high DTI

  1. Pay off the smallest debts first. Removing one monthly payment changes the ratio noticeably.
  2. Refinance high-rate balances into longer terms with smaller minimums, if the long-term cost is acceptable.
  3. Shop for a cheaper home to reduce the mortgage payment.
  4. Increase documented income if possible, for example with a stable second job.
  5. Add a co-borrower with stable income to bring the ratio down.

A realistic example

Monthly debt payments: 1,500. Gross monthly income: 6,000.

DTI = 1,500 ÷ 6,000 × 100 = 25 %, rated Good, comfortably inside the typical conventional loan limit.

Frequently Asked Questions

Gross income, before taxes, as lenders do. Using net income would understate your capacity and is not how underwriting is calibrated.

Some lenders use a payment floor of 5 % of the balance when it exceeds the statement minimum, to reflect large balances paid down slowly. Ask your loan officer which convention their system uses.

The payment disappears in the next billing cycle, which is when the credit bureau updates. Allow 30-45 days for the zero balance to appear on your credit report and give the lender proof of payoff in the meantime.

20 % or less is excellent, 21-35 % is good, 36-43 % is high and anything above 43 % is very high. Most conventional lenders prefer the ratio at 43 % or below, including the new mortgage payment.

The numbers you enter are sent to the server only to compute the results. They are not stored, and they are never shared.

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