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 manage monthly payments and repay debts.
Why is DTI Important?
Before issuing a mortgage or a large loan, lenders want to know that you aren't overextended. A low DTI demonstrates a good balance between debt and income. Conversely, a high DTI ratio can signal that an individual has too much debt for the amount of income earned each month.
How to Interpret Your Score
35% or less: This is generally viewed as favorable. You have manageable debt and likely have money left over for saving or investing.
36% to 49%: You are managing your debt adequately, but lenders may ask you to reduce other debts before approving a major loan like a mortgage.
50% or higher: This is considered critical. With more than half your income going to debt, you have limited funds for unexpected expenses. Lenders often reject mortgage applications in this range.
Front-End vs. Back-End DTI
There are two types of DTI ratios lenders analyze:
Front-End Ratio: This only calculates the percentage of your income that goes toward housing costs (rent or mortgage, property taxes, and insurance). Lenders typically prefer this to be under 28%.
Back-End Ratio: This includes housing costs plus all other recurring monthly debt (credit cards, student loans, car payments). This calculator provides your Back-End DTI, which is the most common metric for overall financial health.
How to Lower Your DTI
To improve your ratio, you can either increase your income or reduce your monthly debt. Strategies include paying off loans with the highest monthly payments first (Snowball Method), refinancing high-interest loans to lower the monthly obligation, or seeking additional income streams.
function calculateDTI() {
// 1. Get input values ensuring they are numbers
var income = parseFloat(document.getElementById('monthlyIncome').value);
var housing = parseFloat(document.getElementById('monthlyHousing').value);
var car = parseFloat(document.getElementById('carLoans').value);
var student = parseFloat(document.getElementById('studentLoans').value);
var cards = parseFloat(document.getElementById('creditCards').value);
var other = parseFloat(document.getElementById('otherDebt').value);
// 2. Handle NaN inputs (treat empty fields as 0)
if (isNaN(income)) income = 0;
if (isNaN(housing)) housing = 0;
if (isNaN(car)) car = 0;
if (isNaN(student)) student = 0;
if (isNaN(cards)) cards = 0;
if (isNaN(other)) other = 0;
// 3. Validation: Income must be greater than 0
if (income <= 0) {
alert("Please enter a valid Gross Monthly Income greater than 0.");
return;
}
// 4. Calculate Totals
var totalDebt = housing + car + student + cards + other;
var dtiRatio = (totalDebt / income) * 100;
// 5. Display Result Container
var resultContainer = document.getElementById('resultContainer');
resultContainer.style.display = 'block';
// 6. Update Text Values
document.getElementById('dtiValue').innerHTML = dtiRatio.toFixed(1) + "%";
document.getElementById('totalDebtDisplay').innerHTML = "$" + totalDebt.toLocaleString();
document.getElementById('incomeDisplay').innerHTML = "$" + income.toLocaleString();
// 7. Handle Visual Bar and Message
var fillBar = document.getElementById('dtiFill');
var messageBox = document.getElementById('dtiMessage');
var message = "";
var color = "";
// Determine status based on industry standards
if (dtiRatio <= 35) {
color = "#28a745"; // Green
message = "Excellent! Your debt is at a manageable level. Lenders typically view this ratio as very favorable.";
messageBox.style.borderLeftColor = color;
} else if (dtiRatio > 35 && dtiRatio <= 43) {
color = "#ffc107"; // Yellow
message = "Good. You are eligible for most loans, but you are approaching the limit. Try to pay down some debt before taking on more.";
messageBox.style.borderLeftColor = color;
} else if (dtiRatio > 43 && dtiRatio <= 49) {
color = "#fd7e14"; // Orange
message = "Caution. Lenders may be hesitant. You may need to pay off some debts to qualify for a mortgage.";
messageBox.style.borderLeftColor = color;
} else {
color = "#dc3545"; // Red
message = "High Risk. More than half your income goes to debt. Consider debt consolidation or aggressive repayment strategies.";
messageBox.style.borderLeftColor = color;
}
// Cap the visual bar at 100% width so it doesn't break layout
var displayWidth = dtiRatio > 100 ? 100 : dtiRatio;
fillBar.style.width = displayWidth + "%";
fillBar.style.backgroundColor = color;
messageBox.innerHTML = message;
// Scroll to results
resultContainer.scrollIntoView({ behavior: 'smooth' });
}