Debt-to-Income Ratio Calculator
Calculate your DTI and check eligibility for Conventional, FHA, VA & USDA loans.
Monthly Income
Monthly Debts
Back-End DTI Ratio
41.54%
Front-end: 27.69% · Rating: Fair
Loan Qualification
Conventional Mortgage
Max DTI: 43%
$95/mo headroom
FHA Loan
Max DTI: 50%
$550/mo headroom
VA Loan
Max DTI: 41%
USDA Loan
Max DTI: 41%
Summary
What Lenders Want
- Conventional mortgages: back-end DTI under 43% (ideally under 36%)
- FHA loans: back-end DTI up to 50% with compensating factors
- Lower DTI = better rates and more loan options
What Is Debt-to-Income Ratio and Why Lenders Care
Your debt-to-income (DTI) ratio is the percentage of your gross monthly income that goes toward debt payments. It's one of the most important numbers in mortgage underwriting — arguably more important than your credit score when it comes to how much you can borrow. A high DTI tells lenders you may struggle to take on additional payments, while a low DTI signals financial headroom.
DTI is calculated as: (Total Monthly Debt Payments ÷ Gross Monthly Income) × 100. If you earn $7,000/month and your total debt payments are $2,450, your DTI is 35%.
Front-End vs Back-End DTI
Lenders look at two DTI numbers:
- Front-end DTI (housing ratio) — Only your housing costs: mortgage principal + interest + property taxes + homeowners insurance + HOA fees. Most lenders want this under 28%.
- Back-end DTI (total ratio) — All monthly debt obligations including housing, auto loans, student loans, credit card minimums, personal loans, child support, and alimony. This is the number that determines loan qualification.
DTI Requirements by Loan Type
| Loan Type | Max Back-End DTI | Notes |
|---|---|---|
| Conventional | 43–45% | Some lenders allow 50% with strong compensating factors |
| FHA | 50% | Most flexible; manual underwriting may allow higher |
| VA | 41% (guideline) | No hard cap — VA uses residual income test |
| USDA | 41% | Strict; limited flexibility beyond 41% |
These are maximums, not targets. A DTI under 36% typically gets you the best rates and widest choice of loan products. Above 43%, your options narrow significantly.
What Counts in DTI (and What Doesn't)
Included: Mortgage/rent, auto loans, student loans (even on IBR — lenders use 0.5% or 1% of balance), credit card minimums, personal loans, child support, alimony, co-signed debt.
Not included: Utilities, cell phone bills, groceries, insurance premiums (except homeowners), subscriptions, medical bills. Your actual budget may feel tighter than your DTI suggests because these expenses are excluded from the calculation.
How to Lower Your DTI Before Applying
- Pay off small debts — Eliminating a $200/month car payment directly drops your DTI. Focus on debts with the fewest remaining payments.
- Increase income — A raise, side gig, or rental income all reduce DTI. Document the income for at least 2 months before applying.
- Avoid new debt — Don't finance a car, open credit cards, or take personal loans in the 6 months before a mortgage application.
- Refinance high-payment loans — Extending a car loan term lowers the monthly payment and reduces DTI (though it increases total interest).
Frequently Asked Questions
Does rent count in DTI if I'm applying for a mortgage?
Your current rent does not count in DTI for a mortgage application. Instead, the lender uses your proposed mortgage payment (PITI — principal, interest, taxes, insurance). If you currently rent and plan to keep the rental after buying, the rent would still not count since it disappears when you move.
Can I qualify for a mortgage with a DTI above 43%?
Yes, in some cases. FHA loans allow up to 50% DTI. Conventional lenders may go to 45-50% with strong "compensating factors" like a high credit score (740+), significant cash reserves (6+ months), or a large down payment (20%+). VA loans use residual income rather than a hard DTI cutoff.