Debt-to-Income (DTI) ratio is a personal finance measure comparing your monthly debt obligations to your gross monthly income. Lenders use it to assess your ability to manage monthly payments and repay debts. Most mortgage lenders require a DTI below 43%.
DTI = (Total Monthly Debt Payments / Gross Monthly Income) × 100
Total Monthly Debt Payments = sum of all recurring minimum debt payments (mortgage/rent, car loans, student loans, credit cards, etc.). Gross Monthly Income = pre-tax monthly income from all sources.
Example 1: Monthly debts: mortgage $1,500, car loan $400, student loan $250, credit card min $100. Gross monthly income: $6,500
Result: DTI = 34.62% (Good — under 36% guideline)
Example 2: Annual salary $72,000, monthly debts: rent $1,800, car $350, credit cards $200
Result: DTI = 39.17% (Borderline — 36–43% may limit loan options)
Use our free Debt-to-Income Calculator to skip the manual math.
Open Debt-to-Income Calculator