Debt-to-income ratio calculator

How do you calculate your debt-to-income ratio?

Add up the monthly payments on everything you owe, divide by your gross monthly income, and multiply by 100: DTI = monthly debt payments / gross monthly income x 100. Gross income means pay before tax and other deductions. The CFPB defines DTI the same way on its consumer pages and notes that different loan products and lenders use different DTI limits; its own example, $2,000 of monthly debts on $6,000 of gross income, gives 33%.

With the defaults, $1,800 of housing, $350 for a car, $250 of student loan and $150 of card minimums make $2,550 a month. On a gross income of $6,500 a month, the back-end ratio is 2,550 / 6,500 = 39.2%. If your salary is quoted per year, choose Per year: $78,000 a year is $6,500 a month and gives the same answer.

What is the difference between front-end and back-end DTI?

The front-end ratio, sometimes called the housing ratio, counts only the housing payment: rent, or for a mortgage the principal, interest, property tax, insurance and association dues. The back-end ratio adds every other debt payment to it. On the default figures the front-end ratio is 1,800 / 6,500 = 27.7% and the back-end ratio is 39.2%.

On the debt side this calculator counts car payments, student loan payments, minimum card payments, personal and other installment loans, and child support or alimony you are required to pay. It leaves out living costs such as food, utilities and phone bills, because a DTI counts debt payments only, which is one reason the ratio says nothing about whether a budget balances. Lenders write their own definitions, so check theirs before comparing.

Is there still a 43% DTI limit for US mortgages?

Not in the general qualified mortgage (QM) definition. Before the CFPB's 2021 General QM amendments, Regulation Z at 12 CFR 1026.43(e)(2) required a General QM loan to have a debt-to-income ratio of no more than 43%. The CFPB's final rule, issued on 10 December 2020 and published at 85 FR 86308 on 29 December 2020, removed that limit and replaced it with price-based thresholds. As the regulation and its official commentary read on the CFPB's site today, a loan is not a General QM if its APR exceeds the average prime offer rate for a comparable loan by the spread below or more:

The lender must still consider the borrower's monthly debt-to-income ratio or residual income, but the rule sets no particular DTI figure; the official commentary lets creditors set their own thresholds and document how they applied them. So 43% is no longer a federal cap on General QM loans, although it still appears in individual loan programs, as the next section shows.

What DTI ratios do FHA loans allow?

For FHA-insured mortgages that are underwritten manually, HUD's Single Family Housing Policy Handbook 4000.1 sets maximum qualifying ratios, written as housing ratio / total debt ratio. Mortgagee Letter 2026-11 of 8 October 2026, which changes how the minimum decision credit score is worked out for case numbers assigned from 1 January 2027, restates the matrix with the same ratios:

Energy efficient homes may use stretch ratios of 33 / 45. These ratios apply to manual underwriting only, and FHA computes them on what the handbook calls Effective Income, which has its own definition. The calculator's default reference lines, 31% and 43%, are this first row; change them to any other lender's figures. A line marks a number to compare with, not a pass or a fail.

How do UK lenders assess mortgage affordability?

UK mortgage lenders do not work to a single DTI ratio. The Financial Conduct Authority's responsible lending rules, in section 11.6 of its Mortgages and Home Finance: Conduct of Business sourcebook (MCOB), have the lender assess whether a mortgage is affordable. That assessment takes account of the customer's income net of income tax and national insurance, the customer's committed expenditure, and the household's basic essential expenditure and basic quality-of-living costs.

Two consequences for this calculator: a UK assessment starts from income after tax, not gross, and it includes living costs that a DTI leaves out. A gross-income DTI from this page is a rough first look for a UK reader, not the test a lender applies.

Worked examples in three currencies

The ratio has no currency, so the same arithmetic works anywhere; amounts are never converted. The incomes and payments below are illustrations.

The pound example's debts are £1,150 housing, £280 for a car and £120 of card payments; the dirham example's are AED 7,000 housing, AED 2,500 for a car and AED 1,000 on cards. The dirham household sits AED 250 a month under a 43% line. For the UK case, remember that lenders work from net income and spending, as the section above sets out.

How does each input move the ratio?

The ratio falls when payments fall or income rises, and the size of each effect is easy to check on the default figures:

• Clearing the $150 of card minimums lowers the back-end ratio from 39.2% to 36.9%.
• Clearing the $350 car payment lowers it to 33.8%.
• A gross income of $7,000 instead of $6,500 lowers it to 36.4%, and the front-end ratio to 25.7%.
• A gross income of $5,000 raises it to 51%; at those payments, $5,930.23 a month of income would be needed to reach 43%.

Paying off a debt changes the ratio by its monthly payment, not its balance, so a small balance with a large payment moves the ratio more than a large balance with a small one. Housing appears in both ratios, so a cheaper home or rent lowers the front-end and the back-end ratio together.

How do you calculate DTI in Excel or a spreadsheet?

Put gross monthly income in one cell, say B1, and each monthly debt payment in the cells below it, B2 to B6. The back-end ratio is =SUM(B2:B6)/B1, formatted as a percentage; the front-end ratio is the housing cell divided by B1, for example =B2/B1. With the defaults, 2,550 / 6,500 returns 39.2% and 1,800 / 6,500 returns 27.7%.

For a yearly salary, divide it by 12 first, or use =SUM(B2:B6)/(B1/12). To find the payments that would sit exactly on a reference line, multiply income by the line: 43% x 6,500 = 2,795, which is $245 more than the default debts.

Common mistakes and what this calculator leaves out

• Using take-home pay. A US-style DTI uses gross income; using net pay overstates the ratio.
• Counting balances instead of payments. Only the monthly payment enters the ratio.
• Leaving out the new loan. If you are applying for a loan, enter the payment it would add to see the ratio with it included.
• Reading a line as a pass mark. Lenders can weigh credit history, cash reserves and the loan itself as well; the FHA matrix above, for instance, turns on credit score and compensating factors.

The calculator does not know a lender's own income rules (how bonuses, self-employment income or rental income are counted), its treatment of deferred student loans, or the rules of any loan program beyond those quoted above. It does not assess UK affordability, which uses net income and spending, and it makes no lending decision.

Glossary

Debt-to-income ratio (DTI): monthly debt payments divided by gross monthly income. Front-end ratio: the housing payment alone divided by gross monthly income. Back-end ratio: all monthly debt payments, housing included, divided by gross monthly income. Gross income: pay before tax and deductions. Qualified mortgage (QM): a US mortgage meeting the Regulation Z definition in 12 CFR 1026.43(e). APOR: average prime offer rate, the benchmark the General QM price limits are measured against. Residual income: income left after debts and certain living costs. Affordability assessment: the UK lender's check under MCOB 11.6 that a mortgage can be paid from net income after spending.

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