Debt-to-Income (DTI) Ratio Calculator
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Debt-to-Income (DTI) Calculator
Calculate your DTI ratio to see if you qualify for a mortgage, auto loan, or personal credit.
Monthly Income & Debts
$
Monthly Recurring Debts:
$
$
$
$
DTI Assessment Results
33.8%
Good Ratio
Total Gross Income $6,500
Total Monthly Debt $2,200
Remaining Monthly Income $4,300
Understanding Your Debt-to-Income (DTI) Ratio
Your Debt-to-Income (DTI) ratio is a key financial metric used by lenders (especially mortgage brokers) to measure your ability to manage monthly payments and repay borrowed money.
What is a Good DTI Ratio?
- 35% or Less (Good): Lenders view you as a low-risk borrower. You will easily qualify for favorable interest rates on mortgages and personal loans.
- 36% – 49% (Moderate): You may still qualify for loans, but lenders might require higher credit scores or larger down payments.
- 50% or Higher (High Risk): Most lenders will deny credit applications or require a co-signer, as you may struggle to balance debt repayments with everyday living expenses.
How to Lower Your DTI Ratio
If your DTI ratio is too high for mortgage pre-approval, you can improve it by:
- Paying off high-interest credit card balances.
- Avoiding new major loan purchases (such as financing a new car) before applying for a mortgage.
- Increasing gross income through raises, bonuses, or side income streams.