Calculate your front-end and back-end ratios for mortgage qualification.
Monthly Debt Obligations:
Front-End Ratio (Housing):0%
Back-End Ratio (Total DTI):0%
Understanding Your Debt-to-Income Ratio
Your Debt-to-Income (DTI) ratio is one of the most critical metrics lenders use to assess your ability to manage monthly payments and repay debts. Unlike your credit score, which measures your credit history, your DTI measures your current financial capacity.
Front-End vs. Back-End Ratio
When applying for a mortgage, lenders look at two specific calculations:
Front-End Ratio (Housing Ratio): This calculates what percentage of your gross monthly income would go toward housing costs (principal, interest, taxes, insurance, and HOA fees). Most conventional loans prefer this to be under 28%.
Back-End Ratio (Total DTI): This includes your housing costs plus all other monthly debt obligations like credit cards, car loans, and student loans. Most lenders prefer this to be under 36%, though some FHA and conventional loans allow up to 43% or even 50% with strong compensating factors.
The "28/36 Rule": A common benchmark in personal finance is the 28/36 rule. It suggests spending no more than 28% of gross income on housing and no more than 36% on total debt service.
How to Lower Your DTI
If your DTI is too high to qualify for the loan you want, you have two primary levers to pull:
Increase Income: Documenting additional income sources such as bonuses, overtime, or a co-borrower's income can increase the denominator in the calculation, lowering the percentage.
Reduce Debt: Paying off a car loan or eliminating credit card balances removes those monthly obligations from the numerator. Note that paying down a balance without eliminating the monthly payment often does not help DTI, as lenders look at the minimum monthly payment due.
What DTI Does Not Include
It is important to note that your DTI calculation generally does not include monthly expenses that are not debts, such as:
Groceries and Utilities
Health Insurance premiums (unless deducted from wages)
Entertainment and subscription services
Transportation costs (gas, insurance)
function calculateDTI() {
// 1. Get Input Values
var grossIncome = parseFloat(document.getElementById('grossIncome').value);
var monthlyRent = parseFloat(document.getElementById('monthlyRent').value);
var creditCards = parseFloat(document.getElementById('creditCards').value) || 0;
var carLoans = parseFloat(document.getElementById('carLoans').value) || 0;
var studentLoans = parseFloat(document.getElementById('studentLoans').value) || 0;
var otherDebt = parseFloat(document.getElementById('otherDebt').value) || 0;
// 2. Validation
if (isNaN(grossIncome) || grossIncome <= 0) {
alert("Please enter a valid Gross Monthly Income.");
return;
}
if (isNaN(monthlyRent)) {
monthlyRent = 0;
}
// 3. Calculation Logic
// Front-End: Housing / Gross Income
var frontEndRatio = (monthlyRent / grossIncome) * 100;
// Total Monthly Debt
var totalMonthlyDebt = monthlyRent + creditCards + carLoans + studentLoans + otherDebt;
// Back-End: Total Debt / Gross Income
var backEndRatio = (totalMonthlyDebt / grossIncome) * 100;
// 4. Update UI
document.getElementById('frontEndResult').innerText = frontEndRatio.toFixed(2) + "%";
document.getElementById('backEndResult').innerText = backEndRatio.toFixed(2) + "%";
var resultsDiv = document.getElementById('results');
resultsDiv.style.display = "block";
// 5. Status Logic
var statusBadge = document.getElementById('dtiStatus');
var statusMsg = document.getElementById('statusMessage');
statusBadge.className = "status-badge"; // Reset classes
if (backEndRatio <= 36) {
statusBadge.innerText = "Excellent / Healthy";
statusBadge.classList.add("status-good");
statusMsg.innerText = "Your DTI is within the recommended range for most loans. You are considered a low-risk borrower.";
} else if (backEndRatio <= 43) {
statusBadge.innerText = "Manageable / Caution";
statusBadge.classList.add("status-warning");
statusMsg.innerText = "Your DTI is slightly elevated. You may still qualify for many mortgages, but you might face stricter requirements.";
} else {
statusBadge.innerText = "High Risk";
statusBadge.classList.add("status-danger");
statusMsg.innerText = "Your DTI is above the standard limit (43%). Lenders may view this as high risk. Consider paying down debt before applying.";
}
}