What Is a Debt-to-Income Ratio Calculator?
A debt-to-income (DTI) ratio calculator measures the percentage of your gross monthly income that goes toward paying debts. Lenders use DTI as a key indicator of your ability to manage monthly payments and repay borrowed money. A lower DTI signals less risk and often qualifies you for better loan terms.
How to Use This Calculator
- Enter your total monthly gross income (before taxes).
- Enter the sum of all monthly debt payments: mortgage, car loans, student loans, credit cards, and other obligations.
- Click “Calculate” to see your DTI ratio and rating.
Understanding Your DTI Ratio
A DTI below 36% is considered good by most lenders. Between 36% and 43% is acceptable but may limit your loan options. Above 43% is considered high risk, and most conventional mortgage lenders will not approve a loan. The formula is: DTI = (Total Monthly Debt Payments ÷ Gross Monthly Income) × 100.
Frequently Asked Questions
What debts should I include?
Include all recurring debt obligations: mortgage or rent, car loans, student loans, minimum credit card payments, personal loans, child support, and alimony. Do not include utilities, groceries, or insurance premiums.
What is a good DTI for a mortgage?
Most mortgage lenders prefer a DTI of 36% or lower for conventional loans. FHA loans may accept up to 43%. Some lenders offer exceptions for strong credit scores or large down payments.