Enter your total debt and total assets (or use the detailed breakdown for monthly income and monthly debt payments) to calculate your Debt Ratio and Debt-to-Income (DTI) ratio. You'll see exactly where your finances stand and what lenders see when they review your application.
Debt-to-Income (DTI) Ratio
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Debt-to-Asset Ratio
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DTI Rating
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Debt Ratio Rating
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Monthly Income After Debt Payments
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Net Worth (Assets − Debt)
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Your debt-to-income ratio (DTI) is the percentage of your gross monthly income that goes toward paying debts. It is calculated by dividing your total monthly debt payments by your gross monthly income. Lenders use this figure to assess your ability to manage monthly payments and repay borrowed money.
DTI ratio = (Total Monthly Debt Payments ÷ Gross Monthly Income) × 100. For example, if you earn $5,000 per month before taxes and pay $1,500 toward debts, your DTI is 30%. Note that DTI is based on income before taxes, not your take-home pay.
Generally, a DTI of 35% or below is considered good. A DTI between 36%–49% signals room for improvement, and lenders may still approve loans but with closer scrutiny. A DTI of 50% or higher is considered high-risk and may make it difficult to qualify for new credit.
The debt-to-asset ratio compares your total outstanding debt to your total assets. It shows what proportion of your assets are financed by debt. A ratio below 0.5 (50%) is generally healthy, meaning more than half your assets are owned outright. DTI, by contrast, focuses on monthly cash flow rather than overall balance sheet strength.
Most mortgage lenders prefer a DTI of 43% or less, and many conventional loans require it to be at or below 36%. A lower DTI means you have more monthly income available for a mortgage payment, which can qualify you for a larger loan or better interest rate.
You can lower your DTI by paying down existing debts (especially high-balance revolving credit), avoiding taking on new debt before applying for a loan, or increasing your gross income through a raise, side income, or additional employment. Even small reductions in monthly debt payments can meaningfully improve your ratio.
DTI itself is not directly factored into your credit score, but the underlying behaviors — high credit card balances and missed payments — do affect it. Lenders review DTI separately during the loan underwriting process to evaluate repayment capacity beyond what your credit score shows.
Include all recurring monthly debt obligations: mortgage or rent, car loans, student loans, minimum credit card payments, personal loans, and any other installment loans. Do not include everyday living expenses like groceries, utilities, or entertainment — only formal debt payments count.