Calculate your DTI ratio in 30 seconds and see if you qualify for a mortgage. Includes the 28/36 rule, front-end vs back-end ratios, and the 43% hard cap most lenders enforce.
Your debt-to-income ratio (DTI) is the percentage of your gross monthly income that goes toward fixed debt payments. Mortgage lenders use it as the #1 affordability check after credit score. A lower DTI means more room in your budget and better loan terms.
The front-end ratio (also called the housing ratio) is just your housing payment divided by income. The back-end ratio includes all debts — housing plus cars, student loans, credit cards, and other obligations. The famous 28/36 rule says front-end should stay under 28% and back-end under 36%.
Fannie Mae and Freddie Mac allow up to 45% back-end DTI with strong compensating factors (high credit score, large reserves). Without them, most automated underwriting caps at 43%.
FHA is more forgiving on credit but stricter on DTI. Manual underwriting can push to 40% front-end with compensating factors. Minimum 3.5% down.
VA loans don't have a published front-end cap but require residual income above regional minimums. No down payment required. Best deal in mortgages if you qualify.
Rural development loans. Strict DTI limits but no down payment and subsidized rates. Income must be under regional caps.
The snowball method: clearing a $500 card with a $25 minimum payment drops your DTI just as much as clearing a $5,000 card. Small wins free up monthly cash flow fast.
Stretching a 4-year car loan to 6 years costs more interest but can drop your monthly payment $150-250 — often enough to swing a mortgage approval. Use our auto loan refinance calculator to model the trade-off.
A $15,000 personal loan at 10% costs ~$325/month for 5 years. The same balance on cards at 20% minimum-payments could be $450+. Saves DTI AND total interest. See our debt consolidation calculator.
Adding a spouse or partner's income to the application immediately lowers the DTI ratio — both incomes count in the denominator, only their shared debts in the numerator.
Counterintuitive but often correct: $20K paid toward a $400/month car loan frees up more DTI room than $20K added to down payment. Many buyers get approved by reallocating savings to debt payoff.
A DTI of 36% or lower is considered healthy by most lenders. The 28/36 rule says your housing payment should be under 28% of gross monthly income, and total debts under 36%. For conventional mortgages, 43% is the maximum DTI most lenders will accept; for FHA loans the back-end cap is typically 43%, for VA loans 41%, and for USDA loans 41%.
DTI = (total monthly debt payments / gross monthly income) x 100. Include minimum credit card payments, car loans, student loans, child support, alimony, and your new mortgage payment (PITI: principal, interest, taxes, insurance). Do NOT include groceries, utilities, or discretionary spending — only fixed debt obligations.
Front-end DTI (housing ratio) is just your housing payment (PITI) divided by gross monthly income. Back-end DTI includes ALL debt payments — housing plus cars, student loans, credit cards, etc. The 28/36 rule says front-end should be under 28% and back-end under 36%.
Conventional loans: typically max 45% back-end DTI (43% as a hard cutoff for most automated underwriting). FHA loans: max 43% back-end, 31% front-end. VA loans: max 41% back-end (residual income also considered). USDA loans: max 41% back-end, 29% front-end. Lower is always better — under 36% gets you the best rates.
DTI itself is not part of your credit score calculation. However, credit utilization (the ratio of credit card balances to limits) IS a major factor — about 30% of your FICO score. High DTI and high utilization usually go together. Paying down credit cards improves both your DTI and your score.
Yes — three fastest ways: (1) Pay off or pay down small-balance credit cards and loans, (2) Consolidate high-payment debts into a lower-payment loan, (3) Increase your income with a side hustle or by asking for a raise. Even a $200/month reduction in debt payments on $6,000/month income moves your DTI by 3.3 percentage points.