What Debts Count in Your DTI Ratio? Complete List
Lenders calculate your debt-to-income ratio using the minimum payments on debts that appear on your credit report — not your total monthly expenses. Your $200 electric bill doesn't count, but your $200 car payment does. Knowing what's included (and what's not) helps you estimate your DTI before applying for a mortgage or loan.
Check your DTI with the DTI Calculator.
Debts That COUNT Toward DTI
| Debt Type | What Lenders Use |
|---|---|
| Mortgage/rent | Monthly payment (PITI: principal, interest, taxes, insurance) |
| Car loan | Monthly payment |
| Student loans | Monthly payment (or IBR amount, or 0.5-1% of balance if in deferment) |
| Credit card minimums | Minimum payment shown on statement |
| Personal loans | Monthly payment |
| HELOC/home equity loan | Monthly payment |
| Child support | Court-ordered monthly amount |
| Alimony | Court-ordered monthly amount |
| Auto lease | Monthly lease payment |
| Cosigned loans | Full monthly payment (unless borrower can prove 12 months of payments) |
| 401(k) loans | Monthly repayment amount |
| Medical debt in collections | May count (lender-specific) |
Debts That DON'T Count
| Expense | Why It's Excluded |
|---|---|
| Utilities (electric, gas, water) | Not on credit report |
| Cell phone bill | Not a debt obligation (unless financed phone) |
| Internet/cable | Not on credit report |
| Car insurance | Not a debt |
| Health insurance premiums | Not a debt |
| Subscriptions (Netflix, gym, etc.) | Not on credit report |
| Groceries | Not a debt |
| Gas/transportation | Not a debt |
| Property taxes (if not in mortgage) | Some lenders include, some don't |
| HOA fees | Some lenders include, some don't |
Common DTI Surprises
| Surprise | What Happens |
|---|---|
| Student loan in deferment | Still counts — lender uses 0.5% or 1% of total balance as payment |
| Cosigned loan you don't pay | Counts as YOUR debt unless borrower proves 12 months of payments |
| Authorized user on someone's card | May count — depends on lender and if it shows on your report |
| Buy Now Pay Later (BNPL) | Increasingly showing on credit reports — may count |
| $0 balance credit card | $0 minimum = doesn't add to DTI |
| Business debt in personal name | Counts toward personal DTI |
How Different Loan Types Handle Student Loans
| Loan Type | Student Loan DTI Calculation |
|---|---|
| Conventional (Fannie Mae) | 0.5% of balance if not on IBR, or IBR payment |
| Conventional (Freddie Mac) | 1% of balance or actual payment |
| FHA | 0.5% of balance or actual payment |
| VA | Actual payment or 5% of balance ÷ 12 |
For a $40,000 student loan balance:
- 0.5% method: $200/month counted
- 1% method: $400/month counted
- IBR payment might be $150/month
The method used significantly affects your DTI and borrowing capacity.
How to Lower Your DTI by Removing Debts
| Strategy | Impact |
|---|---|
| Pay off smallest loan | Removes that payment entirely |
| Get cosigner release | Removes cosigned loan from your DTI |
| Show 12 months of payments on cosigned loan | May exclude from DTI (lender-specific) |
| Switch to IBR for student loans | May lower the counted payment amount |
| Pay credit cards below $0 | $0 minimum = $0 toward DTI |
| Pay off car loan | Removes payment, can significantly lower DTI |
Run your numbers with the DTI Calculator to see where you stand.
Frequently Asked Questions
Which monthly payments are included in DTI?
Lenders include: mortgage/rent, car loans, student loans, credit card minimum payments, personal loans, child support, alimony, and any other debt appearing on your credit report. They do NOT include: utilities, phone bills, insurance premiums, subscriptions, groceries, gas, daycare, or gym memberships. The DTI calculation uses minimum required payments, not what you actually pay. See DTI Needed for Mortgage for maximum ratios by loan type.
Do student loans on deferment count toward DTI?
Yes. Even if you're not currently making payments, lenders count a hypothetical payment: 0.5% of the outstanding balance for IDR-enrolled loans, or 1% for loans in deferment/forbearance without an IDR plan. A $40,000 student loan in deferment adds $200-$400/month to your DTI calculation. See Should You Refinance Student Loans for reducing the payment amount that counts.
How do I calculate my own DTI before applying?
Add up all minimum monthly debt payments that appear on your credit report. Divide by your gross monthly income (before taxes). Example: $2,500 in payments ÷ $7,000 gross income = 35.7% DTI. Pull your free credit report at AnnualCreditReport.com to see exactly which debts lenders will find. See 28/36 Rule Explained for understanding what lenders consider acceptable.
Official Resources
- CFPB — Consumer financial protection and mortgage tools
- AnnualCreditReport.com — Free credit reports from all three bureaus
This article is for informational purposes only and does not constitute financial advice. Consult a qualified financial advisor for guidance tailored to your personal circumstances.
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