Debt-to-Income (DTI) for Home Buying

Debt-to-income (DTI) calculator for home buying and mortgage planning

Your debt-to-income ratio (DTI) is one of the fastest ways lenders assess whether a home loan payment will fit your budget. It compares your monthly debt obligations to your monthly gross income (before tax). The result is a percentage, and it helps show how much of your income is already committed to debt.

This calculator gives you two common DTI views used in home buying: front-end DTI (housing only) and back-end DTI (housing plus other debts). Front-end DTI focuses on your estimated housing payment. Back-end DTI adds your other monthly debt payments such as car finance, credit card minimums, personal loans, student loans, or any required monthly installment commitments.

If you already have a housing payment estimate (for example a proposed mortgage payment plus taxes and insurance), you can enter it to see how your ratios look right now. If you do not have a housing estimate yet, you can still use this calculator to get practical target numbers. It shows maximum housing payment targets based on guideline thresholds so you can sanity-check listings, adjust a deposit, or decide what needs to be paid down before applying.

Assumptions and how to use this calculator

• Gross monthly income is used (before taxes and deductions). If you only know take-home pay, estimate gross using your payslip or employer figures.
• Monthly debt payments should include required minimum payments and fixed installments. Do not include discretionary spending like groceries or fuel.
• Housing payment is treated as PITI (principal, interest, taxes, insurance), and HOA or condo dues are added on top if provided.
• Target thresholds default to 28% front-end and 36% back-end, which are common planning rules. Real approvals can vary by lender, loan type, credit score, and local rules.
• This tool is a planning estimate. It does not account for lender-specific stress tests, interest rate changes, or detailed underwriting factors like net disposable income rules.

Common questions

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

Front-end DTI measures only housing costs compared to your gross income. Back-end DTI measures housing costs plus all other monthly debt payments. In practice, back-end DTI is usually the stricter constraint because it captures your full debt load.

What counts as “monthly debt payments” for DTI?

Include required payments you must make each month: installment loans, car finance, credit card minimums, personal loans, student loans, and any other contractual debt payments. Exclude variable living expenses such as utilities, food, transport costs, and entertainment because those are not “debts” in the standard DTI sense.

What if I do not know my future housing payment yet?

Leave the housing payment blank. The calculator will still show target maximum housing payments based on the DTI thresholds you set. That number is a useful starting point when comparing properties or working backward from an estimated interest rate and loan size.

Is a “good” DTI always 28/36?

No. 28/36 is a common planning rule, not a universal approval rule. Some borrowers are approved with higher ratios, and some are declined with lower ratios depending on income stability, credit profile, savings, deposit size, and lender policy. Use the targets as a conservative benchmark, then refine using your lender or broker’s guidelines.

How can I improve my DTI for a mortgage application?

The quickest levers are reducing monthly debt payments (pay down or consolidate high-payment debts) and increasing provable income (additional stable income streams or verified salary increases). Reducing the proposed housing payment also helps, either by increasing the deposit, choosing a lower-priced property, or extending the term, though longer terms can increase total interest costs.