Debt-to-Income Ratio Calculator
Understanding DTI Ratios
Your debt-to-income ratio (DTI) is a key metric that lenders use to evaluate your ability to manage monthly payments and repay debts. There are two types of DTI ratios:
Front-End DTI
Front-end DTI only considers your housing costs compared to your income. Lenders typically prefer a front-end DTI of 28% or less.
- Less than 28%: Excellent
- 28% to 33%: Good
- 34% to 36%: Fair
- Above 36%: Poor
Back-End DTI
Back-end DTI includes all your monthly debt payments compared to your income. Most lenders prefer a back-end DTI of 36% or less, though some may accept up to 43%.
- Less than 36%: Excellent
- 36% to 42%: Good
- 43% to 49%: Fair
- Above 50%: Poor
Improving Your DTI Ratio
- Pay down existing debts
- Avoid taking on new debt
- Increase your income
- Refinance or consolidate debts
- Consider a larger down payment
Understanding Debt-to-Income Ratios
Your debt-to-income ratio (DTI) is a key metric that lenders use to evaluate your ability to manage monthly payments and repay debts. There are two types of DTI ratios:
Front-End DTI
Front-end DTI only considers your housing costs compared to your income. Lenders typically prefer a front-end DTI of 28% or less.
- Less than 28%: Excellent
- 28% to 33%: Good
- 34% to 36%: Fair
- Above 36%: Poor
Back-End DTI
Back-end DTI includes all your monthly debt payments compared to your income. Most lenders prefer a back-end DTI of 36% or less, though some may accept up to 43%.
- Less than 36%: Excellent
- 36% to 42%: Good
- 43% to 49%: Fair
- Above 50%: Poor
Improving Your DTI Ratio
- Pay down existing debts
- Avoid taking on new debt
- Increase your income
- Refinance or consolidate debts
- Consider a larger down payment