How To Use This Debt-To-Income Calculator
Step 1
Tell Us About Your Budget
Add your income, monthly bills, home price, down payment, rate, taxes, insurance, and HOA. We’ll do the math.
Step 2
See Your Debt-To-Income Ratio
See how much of your income goes toward your new house payment and other monthly debts.
Step 3
See What Your Number Means
Find your range and learn how lenders may view it.
Step 4
Find Ways To Lower Your DTI
Try simple changes and see what could improve your monthly numbers.
Fill In The Yellow Fields. Everything Else Is Calculated.
Tell Us About Your Budget
Add your income, monthly bills, home price, down payment, rate, taxes, insurance, and HOA. We’ll do the math.
Pay before taxes come out
The price you expect to pay
Cash you pay up front
Yearly rate on the loan
Thirty years is most common
We divide this by 12
We divide this by 12
Enter 0 if there are none
Leave at $0 if none applies. Add the monthly amount if your loan includes mortgage insurance or a monthly program fee.
See Your Debt-To-Income Ratio
See how much of your income goes toward your new house payment and other monthly debts.
Your Debt-To-Income Ratio
Total Debt-To-Income Ratio
46.7%
Stretched range
Some programs still work here when your credit, savings, or down payment are strong. Lowering a debt payment helps a lot.
House Payment
$2,902
Principal, interest, taxes, insurance, HOA, and any monthly mortgage insurance or program fee
Other Debt Payments
$600
Total Monthly Debt
$3,502
Gross Monthly Income
$7,500
Here’s How We Got 46.7%
$2,902 house payment + $600 other monthly debts = $3,502 total monthly debt
$3,502 total monthly debt ÷ $7,500 gross monthly income = 46.7% DTI
That is your house payment plus your other monthly debt payments, divided by your income before taxes.
Your Estimated House Payment
$2,902
Housing-Only DTI
Some loan programs look closely at this number, and others focus mostly on your total ratio.
Total DTI
This is the number most lenders talk about when they say your DTI.
See What Your Number Means
Find your range and learn how lenders may view it.
How Lenders See Your DTI
Paying off a car loan or a credit card with a large minimum payment usually moves your ratio more than anything else you can do quickly. Every dollar of required monthly payment you remove goes straight out of the top of the math.
There is no single number that guarantees an approval. Lenders read your ratio next to your credit history, your down payment, the savings you have left after closing, how steady your income is, the type of property, and the loan program you choose. Two people with the same ratio can get different answers.
A lower ratio simply gives you more choices and usually better pricing. A higher ratio does not automatically mean no. It means the rest of your file has to be stronger.
What The Different DTI Ranges Mean
Comfortable
36% Or Less
Usually gives you the most flexibility when comparing loan options and leaves more room in your monthly budget.
Workable
Over 36% Through 43%
A very common range for buyers. Many programs work here, especially with decent credit and some savings left after closing.
Stretched
Over 43% Through 50%
Still possible on some programs when the rest of your file is strong, such as extra savings, a higher credit score, etc.
This is your range today.
Higher Review
Above 50%
This is above the range many programs prefer. Some loan programs may still allow it depending on the rest of your loan file.
Guidelines vary by loan program, credit, down payment, savings, and property type, so these ranges are not promises from any lender.
Find Ways To Lower Your DTI
Try simple changes and see what could improve your monthly numbers.
What Can Improve Your DTI
Six moves, strongest first.
Try a car payment, credit card minimum, or other monthly debt you may be able to pay off.
Enter A Monthly Payment Above To See How Your DTI Could Change
Try a car payment, credit card minimum, or another monthly debt payment.
This is a what-if preview for learning only. It does not change your numbers above and it is not a credit or approval decision.
- Pay off the debts with the biggest minimum payments first. A $450 car payment removed from the math can move your ratio several points.
- Do not open new credit before you buy. A new car loan or financed furniture adds a payment that counts against you.
- Put more cash down. A smaller loan means a smaller house payment, which lowers both ratios.
- Look at a lower price range. Price, taxes, and insurance all move together.
- Add income the lender can document. Steady, provable income counts. Cash side work usually does not.
- Consider a co-borrower. Their income counts, but so do their debts, so run it both ways.
How Lenders Calculate DTI
The math, what counts, and what does not.
Gross monthly income means your pay before taxes and deductions, not the amount that lands in your bank account. Lenders use income they can document with pay stubs, W-2s, or tax returns.
What Counts As Monthly Debt
- Your future house payment: principal, interest, property tax, home insurance, HOA dues, and monthly mortgage insurance or a monthly program fee if it applies
- Minimum credit card payments
- Car loans and car leases
- Student loans
- Personal loans and installment plans
- Child support and alimony ordered by a court
- Payments on other property you own
What Generally Does Not Count
- Utilities, cable, internet, and phone bills
- Groceries, gas, and everyday spending
- Health insurance taken out of your paycheck
- Cell phone and streaming subscriptions
- Money you choose to save each month
- Accounts you have already paid off and closed
Rules vary, so ask your loan officer about anything unusual, such as a debt someone else pays for you.
How The House Payment Is Included
Lenders do not use just the loan payment. They use the full house payment: loan principal and interest, plus monthly property tax, plus monthly home insurance, plus HOA dues, plus monthly mortgage insurance or a monthly program fee if your loan has one.
That is why this calculator asks for your yearly tax and insurance and divides each by 12. Your current rent is not counted, because the new house payment replaces it.
Assumptions This Calculator Uses
- Property tax and home insurance are entered per year and divided by 12.
- HOA dues are entered per month and added to the house payment.
- Monthly mortgage insurance or a monthly program fee is whatever you enter. This calculator does not figure it for you, and it is added to the house payment when it is more than $0.
- Principal and interest use standard fixed-rate amortization, so the payment stays the same every month.
- Housing ratio is the house payment divided by gross monthly income. Total ratio is the house payment plus other debt payments divided by the same income.
- Not included: closing costs, points, flood insurance, utilities, and upkeep. A real quote may differ.
Want the full walkthrough with a worked example? Read the step-by-step guide to calculating debt-to-income ratio.
Frequently Asked Questions
Short answers to the questions we hear most.
- What Does Debt-To-Income Ratio Measure?
- Your debt-to-income ratio, or DTI, is the share of your gross monthly income that goes toward required monthly debt payments. Lenders look at a housing ratio (your future house payment divided by income) and a total ratio (the house payment plus all other required debt payments divided by income).
- Why Do Lenders Look At Debt-To-Income Ratio?
- A mortgage lasts 15 to 30 years. Your credit score shows how you handled debt in the past. Your DTI shows whether you can afford a new house payment on top of what you already owe each month.
- Is DTI Based On Gross Or Take-Home Pay?
- DTI uses gross monthly income, which is your pay before taxes and deductions. Lenders use income they can document, such as salary, verified overtime and bonus, and self-employment income from tax returns.
- What Counts As Monthly Debt?
- Lenders count your future house payment, which includes principal, interest, property tax, home insurance, HOA dues, and monthly mortgage insurance or a monthly program fee if your loan has one. They also count minimum credit card payments, car loans, student loans, personal loans, and court-ordered payments such as child support or alimony.
- What Usually Does Not Count As Monthly Debt?
- Utilities, groceries, gas, phone bills, cable and streaming, day care in most cases, health insurance premiums taken from your paycheck, and accounts you have already paid off are generally not counted.
- Is There One DTI Number That Guarantees Approval?
- No. Guidelines vary by loan program, credit score, down payment, savings and reserves, property type, and other factors. A lower DTI gives you more options, but there is no single universal cutoff.
- How Can I Improve My Debt-To-Income Ratio?
- Pay down or pay off debts with high minimum payments, avoid taking on new debt before you apply, increase your down payment, look at a lower price range, or add a co-borrower whose income can be counted.
Want These Numbers Reviewed For Your Situation?
Send your scenario to Michael Thayer and his team, or book a call directly below.
Prefer to talk it through? Pick a time that works for you.
Booking unlocks once you send your scenario, so Michael has your numbers before the call.
Your information is used only to respond to your mortgage inquiry and is not sold. This is not a loan application and does not constitute any type of formal loan approval.
Your Next Step
Change the yellow boxes above to match your own income, debts, and the home you have in mind. Print the results and bring them with you so the conversation starts with facts instead of guesses.
For illustration purposes only. Actual approvals depend on credit, assets, employment, and lender guidelines and are subject to underwriting approval. This is for educational purposes only and does not constitute any formal quote or intent to lend.