What Is Debt-to-Income Ratio?

Your debt-to-income (DTI) ratio compares your total monthly debt payments to your gross monthly income. Lenders use this number to evaluate your ability to manage monthly payments and repay borrowed money.

DTI Ratio Guidelines

  • 36% or less – Excellent. You're well-positioned for most loans
  • 37% - 43% – Acceptable. Maximum for most qualified mortgages
  • 44% - 50% – High. May need to reduce debt or increase income
  • 50%+ – Very high. Focus on debt reduction

Front-End vs Back-End DTI

Front-end DTI only includes housing costs (mortgage/rent, property tax, insurance). Most lenders want this below 28%. Back-end DTI includes all monthly debt obligations and should be below 36-43%.

Related Tools

Mortgage Calculator

Calculate monthly mortgage payments including taxes and insurance.

Home Affordability Calculator

Find out how much house you can afford based on your income and debts.

Loan Payoff Calculator

See how extra payments shorten any loan and save on interest.

Budgeting Guide

Learn how to create a budget that keeps your DTI ratio in check.