Debt-to-income ratio calculator

Calculate current and proposed debt-to-income ratios

Your debt-to-income ratio, or DTI, compares what you must pay each month toward debt with what you earn before tax. Lenders look at it as one signal of how easily you could take on another payment, and you can use it the same way before you borrow. This calculator turns your income, your housing cost and your required debt payments into two ratios: the front-end ratio, which covers housing only, and the back-end ratio, which covers housing plus every other required debt payment. It then lets you swap in a proposed housing payment and see how both ratios move.

With the example inputs, gross income is 5,000.00 a month, housing is 1,200.00, other required debt is 450.00, the front-end ratio is 24.00% and the back-end ratio is 33.00%. The planning ratios are editable and illustrative. The result is arithmetic, never an approval, and a lender will apply its own rules.

What income and debt should you include?

Gross income and frequency

Use income before tax and deductions. The form has fixed rows for earned income, pension and Social Security, investment and savings income, other income and one additional row, and each amount takes its own frequency: yearly, monthly, twice a month, every two weeks or weekly. The calculator converts everything to a monthly figure by multiplying by the number of periods in a year and dividing by twelve. That is a budgeting normalization, not a prediction of your pay calendar: 1,000 every two weeks counts as 2,166.67 a month (26 payments), while 1,000 twice a month counts as 2,000.00 (24 payments), and 26,000 a year equals the biweekly figure. Income that varies may not all count with a lender, so treat the total as your own estimate.

Housing costs

Choose whether you rent or own. A renter enters rent. An owner enters principal and interest, property tax, insurance, HOA fees and any mortgage insurance, so the front-end ratio reflects the full housing payment, not just the loan. Tax and insurance are often easier to enter per year, and each row has a per-month or per-year selector so an annual tax bill is counted once. If you will keep paying a housing obligation after a move, such as another property, enter it in the retained field so it is neither dropped nor double counted.

Required debt payments

Enter the required monthly payment on each debt, not the balance: for a credit card, that is the minimum payment. Auto loans, student loans and other installment loans belong here, along with any court-ordered support you are required to pay. A payment that will end soon may be treated differently by a lender than one with years left, so the tool simply counts what you enter.

Budget expenses that are left out

DTI is not a budget. Groceries, utilities, childcare, insurance not tied to housing, transport and entertainment are not debt payments and are not in the ratio, which is why a household can have a modest DTI and a tight month. The table summarizes what the tool counts.

It helps to be clear about what DTI leaves out. The ratio says nothing about your credit history, savings, job stability or the value of the property, all of which a lender also weighs. It also treats a debt with a month left the same as one with ten years left unless you decide otherwise. Think of it as one number that summarizes how much of your income is already spoken for, and use it alongside a realistic monthly budget.

DTI formula and worked example

Let G be gross monthly income, H the housing payment and O all other required debt payments, including any retained housing obligation. The front-end ratio is 100 × H ÷ G and the back-end ratio is 100 × (H + O) ÷ G. The Consumer Financial Protection Bureau describes the same idea: add up your monthly debt payments, divide by gross monthly income and read the result as a percentage (CFPB, What is a debt-to-income ratio?). It also notes that DTI limits differ by loan product and lender.

Take gross income of 5,000.00 a month, rent of 1,200.00, a 200 card minimum and a 250 car payment, so O is 450.00. The front-end ratio is 1,200 ÷ 5,000 = 24.00%. The back-end ratio is (1,200 + 450) ÷ 5,000 = 33.00%. Against a 36% back-end planning ratio, the headroom is 0.36 × 5,000 − 1,650 = 150.00 a month. Housing and debt together total 19,800.00 a year.

Front-end versus back-end DTI

The front-end ratio isolates housing and answers whether the roof over your head is proportionate to income. The back-end ratio adds everything else and answers whether your total obligations are. They can disagree: someone with a small housing payment and large car and student loans can pass a front-end test and still be stretched on the back-end.

Replacing housing shows the difference. Suppose the renter above moves to a place with a 1,500 all-in monthly payment. The replacement substitutes for the old 1,200 rent; it is not added to it. Debts of 450.00 stay. The front-end ratio becomes 30.00% and the back-end ratio becomes 39.00%, which is 150.00 over a 36% back-end planning ratio. The calculator keeps the sign, so a shortfall shows as negative headroom rather than disappearing. The housing budget that stays inside both planning ratios with the same debts is 1,350.00. To compare a rent figure with a cash-flow budget rather than a ratio, compare a rent budget, and to convert a housing budget into a price, estimate a home purchase budget.

The two ratios often tell different stories, so read both before concluding anything. A high front-end ratio with a low back-end ratio means housing is heavy but you carry little other debt, while the reverse points to other obligations crowding out housing. When ratios disagree, ask which of the two a lender or your own budget is most sensitive to, rather than averaging them.

What is a good DTI?

There is no single number that is good for every lender or loan. Fannie Mae’s Selling Guide, which governs many conventional mortgages in the United States, lists a 36% maximum total DTI for manually underwritten loans, extendable to 45% when credit score and reserve requirements are met, and a 50% maximum for loans underwritten through its automated Desktop Underwriter, with exceptions for particular transaction types (Fannie Mae Selling Guide B3-6-02). Guidance changes, so check the current version, and government-backed loans follow their own rules.

That is why the calculator’s 28% front-end and 36% back-end defaults are called illustrative planning ratios: they are common rules of thumb you can edit, not approval thresholds. A lower ratio leaves more room for surprises, and a higher one means a larger share of income is committed before the first grocery bill. If your own comfortable level is lower than any lender’s limit, plan to that lower number.

Scenarios make the arithmetic concrete. If the example income rose from 60,000 to 66,000 a year, gross monthly income would be 5,500.00 and the back-end ratio would fall from 33.00% to 30.00%. If instead the 250 car payment ended and everything else stayed the same, the back-end ratio would fall to 28.00%. Each change is real only if the payment actually disappears or the income is lasting; a temporary bonus or a debt you still owe does not count. Use the form to test a change, then confirm it against documents.

Ways to change DTI without confusing it with a budget

Only two things move a ratio: the amount of debt payment or the amount of income. Paying a loan off removes its payment, which lowers the ratio, but paying down a credit card balance does not automatically lower the required minimum, so enter the minimum you will actually owe. Refinancing into a longer term can lower a monthly payment while raising lifetime interest, and a raise or a second earner increases the denominator. To compare ways of clearing debt, compare debt repayment strategies, and to see what a new loan would add, estimate a proposed loan payment. These are educational estimates, not financial advice; see the disclaimer.

DTI calculator FAQs

How do I calculate my debt-to-income ratio?

Add required monthly debt payments, including the housing payment for the scenario, divide by gross monthly income and multiply by 100.

What is a good debt-to-income ratio?

There is no single approval threshold for every lender or loan. Use the editable ratios as planning assumptions and confirm actual requirements with the lender.

Should I use gross income or take-home pay?

Use income before taxes for DTI. A separate cash-flow budget should use take-home income and include living expenses.

Do I include rent and a new mortgage together?

For a replacement scenario, exclude rent that will stop. Include a housing obligation you will retain, using the separate retained-obligation field.

Do credit card balances count as monthly debt?

Enter the required monthly minimum payment rather than the full balance. Actual lender treatment may differ.

Does a low DTI mean a mortgage will be approved?

No. Lenders also review verified income, credit, assets, property and product requirements. This calculator makes no lending decision.