Enter your income and monthly debt payments below.
Your Debt-to-Income Ratio is:
0%
What is a Debt-to-Income (DTI) Ratio?
Your Debt-to-Income (DTI) ratio is a personal finance measure that compares an individual's monthly debt payment to their monthly gross income. Lenders use this ratio to determine your ability to repay borrowed money. Basically, it answers the question: how much of your income is already spoken for by debts?
Why Your DTI Score Matters
Whether you are applying for a mortgage, an auto loan, or a personal line of credit, your DTI is a critical factor. Even if you have a high credit score, a high DTI can result in your loan application being rejected or attracting a higher interest rate.
Understanding the DTI Thresholds
Under 36% (Good): Most lenders view this as a healthy ratio. You likely have disposable income and are a low-risk borrower.
36% – 43% (Manageable): You may still qualify for loans, but lenders might ask for more documentation or offer slightly higher rates. This is often the upper limit for Qualified Mortgages.
Over 43% (High Risk): Borrowers with a DTI above 43% may find it difficult to get approved for a mortgage. It suggests that a significant portion of your income goes towards debt repayment, leaving little room for unexpected expenses.
How to Lower Your DTI Ratio
If your calculation shows a high percentage, consider these strategies:
Increase your income: Taking on freelance work, asking for a raise, or including a co-borrower on the loan application can increase the denominator of the ratio.
Pay down debt: Focus on high-interest credit cards or paying off small loans entirely to remove that monthly obligation from the numerator of the calculation.
Avoid new debt: Do not open new credit lines before applying for a major loan like a mortgage.
How This Calculator Works
This tool sums up your monthly obligations—including rent or mortgage payments, car loans, student loans, and credit card minimums—and divides that total by your gross monthly income (your annual income divided by 12). The result is expressed as a percentage.
function calculateDTI() {
// 1. Get input values
var annualIncome = parseFloat(document.getElementById('annualIncome').value) || 0;
var rent = parseFloat(document.getElementById('monthlyRent').value) || 0;
var car = parseFloat(document.getElementById('carLoan').value) || 0;
var student = parseFloat(document.getElementById('studentLoan').value) || 0;
var cards = parseFloat(document.getElementById('creditCards').value) || 0;
var other = parseFloat(document.getElementById('otherDebt').value) || 0;
// 2. Validate Income
if (annualIncome <= 0) {
alert("Please enter a valid Annual Gross Income greater than 0.");
return;
}
// 3. Calculate Monthly Gross Income
var monthlyIncome = annualIncome / 12;
// 4. Calculate Total Monthly Debt
var totalMonthlyDebt = rent + car + student + cards + other;
// 5. Calculate DTI Ratio
var dtiRatio = (totalMonthlyDebt / monthlyIncome) * 100;
// 6. Round to 2 decimal places
dtiRatio = Math.round(dtiRatio * 100) / 100;
// 7. Update UI Text
var resultElement = document.getElementById('dtiResult');
var statusElement = document.getElementById('dtiStatusBox');
var explanationElement = document.getElementById('dtiExplanation');
var resultsArea = document.getElementById('results-area');
resultElement.innerHTML = dtiRatio + "%";
resultsArea.style.display = "block";
// 8. Determine Status Logic
statusElement.className = "dti-status"; // reset classes
var statusText = "";
var explanationText = "";
if (dtiRatio 35 && dtiRatio <= 43) {
statusElement.classList.add("status-warn");
statusText = "Manageable";
explanationText = "Your DTI is acceptable for most lenders, though you are nearing the limit for some mortgage programs.";
} else {
statusElement.classList.add("status-bad");
statusText = "High Risk";
explanationText = "Your DTI is above 43%. Lenders may view this as risky, making it harder to qualify for new credit or mortgages.";
}
statusElement.innerHTML = statusText;
explanationElement.innerHTML = explanationText;
}