Real Estate & Credit
Debt to Income Calculator
See how much of your income goes to debt and where you sit vs the 43% rule.
Debt to Income Calculator
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How it works
The debt to income ratio divides your monthly debt payments by your monthly gross income. At $1,800 of debt on $5,500 of income, the DTI is 33%, meaning a third of what you earn already services debt.
Lenders use DTI to size mortgages: most conventional programs cap total DTI around 43-45%, and staying under 36% keeps your options wide. It is the borrower-side counterpart to the property-side DSCR.
Formula
DTI = Monthly debt payments / Monthly gross income
Debt includes mortgages, car loans, student loans, credit card minimums and alimony or child support.
Worked example
Example: monthly debts of $1,800 on $5,500 of gross income. DTI = 1800 / 5500 = 32.7%. A lender sees a healthy profile, well under the 43% ceiling and close to the 36% comfort zone.
WORKED EXAMPLE — DEFAULT INPUTS
What to know
When lenders quote a maximum DTI around 43%, they are leaving room for the new mortgage payment to land on top of your existing debts. A borrower at 30% DTI with no other obligations can carry a large mortgage; one at 38% with car and student loans has much less capacity.
Lowering your DTI before applying is a concrete plan: pay off credit cards, settle small loans, and avoid new financing in the months before the application. Each recurring dollar removed expands the mortgage you can responsibly carry.
Recalculate after any raise, payoff or new loan; the ratio moves with each change, and knowing the current number keeps your borrowing options open when they matter.
FAQ
What is the 43% rule?
Qualified mortgages generally cap the borrower total DTI at 43%, and many lenders prefer 36% or lower. Above 43% you will struggle to qualify for a standard loan.
What counts as monthly debt?
Recurring obligations: mortgages, auto loans, student loans, personal loans, credit card minimums, and court-ordered payments. Utilities and groceries do not count.
Does DTI include the new mortgage?
For a home purchase, lenders add the proposed mortgage payment into the numerator and recalculate. That is why buying shrinks your available capacity.
How do I lower my DTI?
Pay down revolving debt, refinance to lower payments, extend loan terms, or raise income. Each dollar of monthly debt removed frees about $3 of mortgage capacity at a 33% ratio.