Debt-to-Income Calculator
Calculate your DTI ratio to see how much mortgage you can afford.
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Monthly Debts
Proposed Mortgage
What is a debt-to-income (DTI) ratio?
Your debt-to-income ratio is the percentage of gross monthly income that goes out the door each month in debt payments. It is the single number underwriters use to decide how much new debt you can carry, and it is separate from your credit score: you can have a 760 FICO and still be declined for a 52% back-end ratio.
There are two versions. Front-end DTI, sometimes called the housing ratio, counts only the proposed housing payment — principal, interest, property taxes, homeowners insurance, HOA dues, and mortgage insurance. Back-end DTI adds every recurring monthly debt on the credit report: auto loans, student loans, credit card minimums, personal loans, child support, and alimony. The back-end figure is the one that decides approvals, and it is almost always the higher of the two.
The classic guideline is 28% front-end and 36% back-end. Lenders approve beyond it routinely: conventional loans are commonly approved to 43% and sometimes 50% when the file carries compensating factors, and FHA will go to 50% or higher when residual income — the cash left after the payment — is strong. On $7,000 of gross monthly income, a 36% back-end means $2,520 of total monthly debt; at 43% it means $3,010; at 50% it means $3,500. The difference between those numbers is often the difference between a $300,000 house and a $380,000 house.
Two mechanics matter more than the percentages. First, everything is measured on gross income — before taxes, 401(k) deductions, and health premiums — computed as annual salary divided by 12. Second, the ratio is measured against the full housing payment, not the loan payment: on a $400,000 loan at 6.5%, principal and interest is $2,528.27, but with $416.67 of property tax and $125 of insurance the lender tests $3,069.94. That 4.5-percentage-point difference on a $12,000 income is enough to move an approval into a denial.
How to use this calculator
- Enter gross monthly income before taxes. If you know your annual salary, divide by 12 — $144,000 ÷ 12 = $12,000.
- List the proposed housing payment as it will appear on the loan: principal, interest, taxes, insurance, HOA, and PMI.
- Add every other monthly debt using the payment the credit report will show — auto loans, student loans, credit card minimums, personal loans, child support.
- Click Calculate to see front-end DTI, back-end DTI, and where both land against standard lender thresholds.
- Adjust the housing line until the back-end figure sits where you want it, then work backward to a price with the affordability calculator.
A realistic input set: gross monthly income $12,000 (that is $144,000 a year ÷ 12); proposed housing payment $3,069.94, built from $2,528.27 of principal and interest on a $400,000 loan at 6.5%, $416.67 of property tax on a $500,000 home at 1.0%, and $125 of homeowners insurance at $1,500 a year. Other debts: a $450 car payment, $300 of student loans, $120 in credit card minimums, and a $200 personal loan — $1,070 total. The result is a 25.6% front-end and a 34.5% back-end, both inside the 28/36 guideline. Drop the income to $10,000 and the same file becomes 30.7% and 41.4%, which clears most conventional programs but misses the guideline.
How your DTI ratio is calculated
The math is division, done twice. Convert income to a monthly figure, divide housing by it for the front-end ratio, then divide housing plus all other debts by it for the back-end ratio.
Front-end DTI = housing payment ÷ gross monthly income × 100 and Back-end DTI = (housing payment + monthly debts) ÷ gross monthly income × 100
Here gross monthly income is annual gross ÷ 12 — salary, overtime, bonus, commission, and self-employment income (which requires two years of tax returns), housing payment is full PITI plus HOA and PMI, and monthly debts are the minimum payments shown on the credit report, not the balances.
Worked example: $144,000 income, $400,000 loan, $1,070 of other debt
Step 1: gross monthly income is 144,000 ÷ 12 = $12,000. Step 2: housing is 2,528.27 + 416.67 + 125 = $3,069.94. Step 3: front-end is 3,069.94 ÷ 12,000 = 0.2558, or 25.6%, against the 28% guideline — $3,360 − $3,069.94 = $290.06 of monthly room.
Step 4: total debt is 3,069.94 + 1,070 = $4,139.94. Step 5: back-end is 4,139.94 ÷ 12,000 = 0.3450, or 34.5%, against the 36% guideline — $4,320 − $4,139.94 = $180.06 of room. Step 6: invert the ratio to find the loan. At 28% the housing budget is $3,360, minus $541.67 of tax and insurance leaves $2,818.33 for principal and interest, which at 6.5% over 360 months is a loan of about $445,900. At 36% back-end with $1,070 of other debt the budget is $4,320 − $1,070 = $3,250, which is $2,708.33 of principal and interest and a loan of about $428,500. The lower of the two governs: $428,500, not $445,900.
Worked scenarios
The same mortgage produces a different verdict at every income level, and the same income produces a different verdict at every debt level. The tables separate the two.
Income thresholds: housing payment of $3,069.94 plus $1,070 of debt
| Gross monthly income | 28% front-end cap | 36% back-end cap | 43% back-end cap | 50% back-end cap |
|---|---|---|---|---|
| $6,000 | $1,680 | $2,160 | $2,580 | $3,000 |
| $8,000 | $2,240 | $2,880 | $3,440 | $4,000 |
| $10,000 | $2,800 | $3,600 | $4,300 | $5,000 |
| $12,000 | $3,360 | $4,320 | $5,160 | $6,000 |
| $15,000 | $4,200 | $5,400 | $6,450 | $7,500 |
Read each row against the $4,139.94 of total monthly debt in our example. At $6,000 the file fails every column. At $8,000 it clears only the 50% column. At $10,000 it clears 43% and 50%. At $12,000 it clears all four. That is what underwriters mean when they say a file is "within guidelines" — it is arithmetic, not a judgment about you.
Borrower profiles: four real ratios
| Borrower | Gross monthly income | Housing (PITI) | Other debts | Front-end | Back-end |
|---|---|---|---|---|---|
| A — tight but clean | $8,000 | $2,100 | $900 | 26.3% | 37.5% |
| B — comfortable | $12,000 | $3,000 | $600 | 25.0% | 30.0% |
| C — FHA territory | $6,500 | $1,900 | $700 | 29.2% | 40.0% |
| D — over the line | $9,000 | $3,200 | $1,400 | 35.6% | 51.1% |
Borrower A misses 36% by 1.5 points but clears the 43% conventional threshold with clean credit and two months of reserves. Borrower B qualifies at every program sold. Borrower C misses 36% badly but sits inside FHA's 43% with room to 50%. Borrower D fails every published guideline and needs either $1,000 of debt retired — $1,400 to $400 moves the back-end to 40.0% — or a $40,000 cheaper house.
What each debt costs you in ratio points
| Monthly debt paid off | Points gained at $8,000 income | At $10,000 | At $12,000 |
|---|---|---|---|
| $200 | 2.5 | 2.0 | 1.7 |
| $400 | 5.0 | 4.0 | 3.3 |
| $600 | 7.5 | 6.0 | 5.0 |
| $1,000 | 12.5 | 10.0 | 8.3 |
The lower your income, the more every dollar of debt costs — a $600 car payment is 7.5 points on $8,000 and 5.0 points on $12,000. This is why retiring one small loan before you apply often changes the outcome: removing a $400 payment lifts borrower A from 37.5% to 32.5%, back inside the 36% guideline without touching the housing budget.
DTI guidelines by loan program
| Loan program | Front-end | Back-end | Notes |
|---|---|---|---|
| Conventional | 28% target | 36% target, 43% typical max | Up to 50% with automated approval and 2 months of reserves |
| FHA | 31% | 43% standard, 50%+ allowed | Requires documented residual income and compensating factors |
| VA | No limit | No limit | Lenders usually cap at 41%; the VA residual income test governs |
| USDA | 29% | 41% | Both ratios are hard limits |
| Jumbo | 33%–38% | 38%–43% | Lower tolerance for high balances and thin reserves |
The Consumer Financial Protection Bureau describes the ratios and why 43% became the reference point in its guide to debt-to-income ratios. Treat 28% and 36% as your own targets and 43% as the outer edge of normal approval — the further you push past 36%, the more compensating factors the file needs.
DTI requirements, thresholds, and compensating factors
- 28% front-end guideline: $3,360 of housing on a $12,000 gross monthly income. FHA uses 31%, USDA 29%, VA none. On our $500,000 example the payment is $3,069.94, which is 25.6% — inside every guideline.
- 36% back-end guideline: $4,320 of total monthly debt on $12,000. With $1,070 of existing debt that leaves $3,250 for housing, or about $2,708 of principal and interest — a $428,500 loan at 6.5%.
- 43% to 50% approval band: $5,160 to $6,000 of total debt on $12,000. Conventional loans reach 43% routinely and 50% with automated underwriting; FHA permits 50% or more with residual income and compensating factors.
- Compensating factors that earn the extra points: a credit score of 720 or higher, six months or more of housing payment reserves, 20% down or more, a payment that is lower than your current rent, low credit card utilization, and a stable two-year employment history.
- Income that counts: base salary, two-year histories of overtime, bonus, and commission, Social Security, pension, and alimony. Self-employment income requires two years of filed returns. Gift funds are not income.
- Debts that count: auto, student, personal, and installment loans at the scheduled payment; credit cards at the minimum; child support and alimony; and any co-signed obligation. Deferred student loans still count — generally 1% of the balance on conventional and 0.5% on FHA when no payment is due.
- Residual income (VA and FHA): cash left after the mortgage, taxes, insurance, and other obligations. VA's regional table requires roughly $450 for a single borrower and about $1,003 for a family of four on loans above $80,000 — the real test for a no-DTI-cap loan.
- What does not count: utilities, groceries, gas, insurance other than mortgage insurance, and retirement contributions deducted from gross pay before it reaches your W-2.
DTI tips for 2026
- Run your ratios before you tour homes, not after. Gross monthly income ÷ 12, then the payment, then the debts. Ten minutes with this calculator separates a $428,500 budget from a $561,400 one — the gap between the 36% and 43% columns on $12,000 of income — before you have fallen for a kitchen.
- Hold yourself to 36% even though 43% is available. On $12,000 of income that is $4,320 of allowed debt versus $5,160 at the outer limit — $840 a month of margin. That margin absorbs a tax increase, an insurance renewal, or a car repair without a late payment that would cost you the loan next time you refinance.
- Count the full housing payment, not the loan payment. Taxes and insurance add $541.67 to the $2,528.27 example above — 4.5 points of front-end ratio on a $12,000 income. Buyers who qualify on principal and interest alone discover the difference at the underwriter's desk, usually after the offer is accepted.
- Retire debt with the smallest payments first. Eliminating a $400 personal loan frees 3.3 points of back-end ratio on $12,000 and 5.0 points on $8,000. It also reduces the minimum payment the credit report shows, which is what the ratio actually measures — the balance matters less than the obligation.
- Freeze new credit from pre-approval through closing. A $450-a-month car payment added in between costs 3.8 points on a $12,000 income, and a furniture-store account opened at the closing table can trigger a post-closing audit. Pay cash or wait.
- Document variable income properly. Overtime, bonus, commission, and side work only count with a two-year history, and underwriters average them — a strong third year does not raise the qualifying figure. If you are self-employed, two clean years of returns is the entry ticket.
- Price the payment before you raise the price. Every $100,000 financed costs $632.07 a month at 6.5% over 30 years — 5.3 points of back-end ratio on $12,000. Trading one price tier for a lower one is usually more effective than any amount of debt cleanup.
Common mistakes with debt-to-income ratios
- Using take-home pay instead of gross income. Lenders divide by gross — salary before taxes and deductions. A $144,000 salary that nets $8,600 a month still qualifies as $12,000. People who test their own ratios on net income either talk themselves out of a purchase they can afford or, worse, apply expecting the lender to use the same figure.
- Forgetting that the ratio uses PITI, not principal and interest. The mortgage payment on this page is $2,528.27; the number underwritten is $3,069.94 once tax and insurance are added, and $3,291.61 when a $221.67 PMI premium applies on top. Each omission is several points of ratio you will be asked to explain.
- Assuming 36% is the maximum. It is the guideline, not the ceiling. Conventional approvals at 43% are routine and 50% happens with automated underwriting, reserves, and strong credit; FHA reaches 50% and beyond with residual income. The file structure matters as much as the number.
- Ignoring deferred student loans. A $60,000 balance with a $0 payment is still counted at about 1% on conventional loans — $600 a month — and 0.5% ($300) on FHA. That single line can move the back-end ratio 5 points on a $12,000 income. Know the treatment before you pick the price point.
- Co-signing a loan you do not pay. If your name is on the note, the full payment counts against your ratio even when someone else sends the check. A $350 payment you cosigned is 2.9 points of back-end ratio — enough to push a 38% file past 43%.
- Changing jobs or going self-employed during the application. Lenders want a two-year history; a new salaried role usually works with an offer letter, but a brand-new business does not count until it has two years of filed returns. The timing of the move matters more than the income it promises.
Frequently asked questions
What is a good debt-to-income ratio? Under 36% back-end is healthy, under 30% is excellent, and anything over 43% needs compensating factors to clear underwriting. On $12,000 of gross monthly income that means $4,320 of total monthly debt for the guideline, $3,600 for the excellent mark, and $5,160 as the practical outer edge of approval.
How do I calculate my DTI? Divide gross monthly income — annual ÷ 12 — into your housing payment for front-end DTI, then into housing plus all monthly debts for back-end DTI. On $12,000 of income with $3,069.94 housing and $1,070 of debt: 3,069.94 ÷ 12,000 = 25.6% and 4,139.94 ÷ 12,000 = 34.5%.
What counts as debt in the back-end ratio? Auto loans, student loans, credit card minimums, personal and installment loans, child support, alimony, and co-signed obligations. Utilities, groceries, insurance, and retirement contributions do not count. Credit cards are measured at the minimum payment shown on the report, not at the balance.
Can I get a mortgage with a high DTI? Possibly. Conventional loans commonly approve at 43% and up to 50% with strong credit and two months of reserves; FHA permits 50% or more when residual income is sufficient. At 50% of a $12,000 income you may carry $6,000 of total monthly debt, including the full housing payment.
Does student loan debt count? Yes. When a payment is due, the scheduled amount counts. When the loan is deferred or on an income-driven plan with a $0 payment, lenders generally count 1% of the balance on conventional loans and 0.5% on FHA — a $60,000 balance is $600 or $300 a month in the ratio.
What front-end ratio do lenders want? The classic guideline is 28%, FHA uses 31%, and USDA allows 29%. On $12,000 of income that is $3,360, $3,720, and $3,480 of housing respectively. Your own target should stay at or below 28% even when the program allows more.
How can I lower my DTI quickly? Retire small debts first: a $400 monthly payment removed gains 3.3 points at $12,000 and 5.0 points at $8,000. Lowering the price by $50,000 removes $316.03 of payment — 2.6 points. Do not close cards to raise a score; the minimum payment disappearing is what helps the ratio.
Does my spouse's debt count? If you apply jointly, both incomes and both sets of debts count, which usually raises the ratio denominator faster than the numerator. In community property states a spouse's debt may be attributed even on a solo application. Run the file both ways before choosing who signs.