Debt-to-Income Ratio Calculator

Your numbers

Example loaded: $6,000 of gross monthly income, $1,650 rent, and five monthly debts. Replace the numbers with your own.

How debt-to-income ratio is calculated

Your debt-to-income ratio is your monthly debt payments divided by your gross monthly income. The CFPB defines it the same way, using income before taxes and deductions.

To reach 36% or less with the same income, total monthly obligations would need to drop to $2,160. That's $620 a month less than today.

What counts as a monthly debt payment

DTI generally includes credit card minimums, auto loans and leases, student loans, personal loans, other installment loans, and required child support or alimony. Use the required payment for each one, even if you usually pay more. Mortgage lenders may calculate a different amount for certain student loans, including some with a $0 payment. Fannie Mae's monthly debt guidelines explain those exceptions.

Everyday bills generally don't count. Utilities, phone, internet, groceries, car insurance, health insurance, subscriptions, and regular income taxes stay out of the ratio, even though they affect what you can afford. An installment agreement for unpaid taxes can count. A card with a $0 balance normally has no minimum payment to include.

Front-end vs. back-end DTI

This calculator's front-end figure shows your current housing payment as a share of gross income. For renters, that's a housing-budget measure. For a mortgage application, the lender generally replaces current rent with the proposed mortgage payment. Back-end DTI includes housing plus the other monthly debt payments entered.

The traditional 28/36 rule of thumb suggests spending no more than 28% of gross income on housing and 36% on housing plus debts. It's a reference point, not Fannie Mae's front-end eligibility rule.

DTI limits lenders commonly use

There's no single cutoff. The clearest published limits come from mortgage guidelines. Fannie Mae's Selling Guide sets a 36% maximum total DTI for manually underwritten loans, allows up to 45% when the borrower meets credit-score and reserve requirements, and allows up to 50% for loans approved through its automated underwriting system.

Personal loan, car loan, and credit card lenders set their own limits, and many don't publish them. If you're planning to apply for a debt consolidation loan or a balance transfer card, a lower ratio generally gives you more options. It's one factor among several, along with your credit score and income history.

How to choose payoffs that lower your DTI

DTI uses monthly payments, not balances. The biggest drop per dollar comes from a debt with a large monthly payment relative to its balance. That isn't necessarily your largest or smallest debt.

In the example above, paying off the $22,000 student loan removes a $310 payment and brings DTI to 41.2%. Paying off the $4,100 personal loan removes $260 a month for about a fifth of the money and brings DTI to 42.0%. But the most efficient single payoff isn't always the cheapest way to reach a target. Here, paying off the car loan and personal loan together costs $13,900, removes $685 a month, and brings DTI to 34.9%.

This is different from minimizing interest cost. The Snowball vs. Avalanche Calculator compares payoff orders by interest and time. Before using savings to improve DTI, consider the interest you'll avoid, the cash you'll still have available, and the specific lender's requirements.

DTI vs. credit utilization

The two ratios measure different things. DTI compares monthly payments with income, and it isn't part of your credit score because credit reports don't include income. Credit utilization compares card balances with credit limits, and it's a major credit-score factor. Lenders usually look at both.

Paying down a card can lower utilization a lot while barely moving DTI, because the minimum payment only falls a little. The Credit Utilization Calculator shows the balance side of the picture.

Debt-to-income ratio calculator FAQ

What is a good debt-to-income ratio?

A back-end DTI of 36% or less is a traditional reference point. For Fannie Mae mortgages, manually underwritten loans can reach 45% with added requirements, while automated underwriting can allow up to 50%. Other lenders and loan products set their own criteria.

Does rent count in my debt-to-income ratio?

This calculator includes your current rent to show what portion of income goes toward housing and debts. For a mortgage application, the lender generally uses the proposed mortgage payment instead of your current rent. Other loan products may treat housing costs differently.

Does my debt-to-income ratio affect my credit score?

No. Credit reports don't include your income, so DTI isn't part of a credit score. Your balances and payment history still affect your score through other factors, such as credit utilization.

Should I use gross or net income for DTI?

Use gross income, before taxes and deductions. When estimating a loan application's DTI, include only income the lender is likely to count, such as qualifying income from applicants on the loan.

How can I lower my debt-to-income ratio quickly?

Paying off a debt in full removes its monthly payment. Compare the payment removed per dollar paid off, then check the lowest-cost combination that reaches your target. These aren't always the same choice. Paying a loan down partway usually doesn't change its scheduled payment.

Learn more about debt and income