Debt-to-income ratio calculator
Enter your gross monthly income and regular monthly debt payments. The calculator shows DTI excluding housing and, if entered, DTI including rent or mortgage payments.
How to use this calculator: use gross income for consistency, add fixed monthly debt commitments, then compare the DTI excluding housing with the wider housing-inclusive figure.
Debt-to-income ratio formula
Debt-to-income ratio compares monthly debt payments with gross monthly income. This calculator shows two versions because some people track debt only, while others want to see the effect of housing costs too.
DTI excluding housing =
monthly_debt_payments ÷ gross_monthly_income × 100
DTI including housing =
(monthly_debt_payments + rent_or_mortgage) ÷ gross_monthly_income × 100
What your DTI result means
A lower debt-to-income ratio usually suggests more breathing room because less of your income is already committed to debt payments. A higher ratio can mean that new borrowing may feel harder to manage.
This is not a lender approval tool. Lenders may look at income, credit file, spending, household costs, dependants, employment status, existing commitments and the type of credit you are applying for.
Check affordability before borrowing
If your DTI is already stretched, compare the total cost carefully and avoid using new credit to cover normal living costs.
DTI risk bands
These bands are only a broad personal finance guide. They are not official lender thresholds.
| DTI range | Broad guide | What it may suggest |
|---|---|---|
| Under 20% | Lower pressure | Debt payments take a smaller share of income. |
| 20% to 35% | Moderate pressure | Debt is noticeable but may still be manageable. |
| 35% to 50% | Stretched | There may be less room for savings or unexpected costs. |
| Over 50% | High pressure | Debt commitments may be difficult to sustain. |
What counts as debt payments?
Include regular credit commitments that you are expected to pay each month. For credit cards, use the minimum payment or the fixed amount you have committed to paying.
- Personal loan repayments.
- Credit card minimum payments.
- Car finance payments.
- Store finance or catalogue credit.
- Debt management plan payments.
- Other fixed borrowing commitments.
Normal living costs such as food, utilities, insurance and subscriptions are not usually classed as debt payments, but they still matter for affordability.
Ways to lower your DTI
- Pay down balances: reducing debt can lower monthly commitments.
- Avoid new borrowing: new credit can increase your debt payments.
- Increase income: higher gross income can lower the percentage.
- Refinance carefully: consolidation may reduce monthly payments, but can cost more overall if the term is longer.
- Clear small payments: removing small debts can simplify your monthly commitments.
- Build an emergency buffer: savings can reduce reliance on credit when unexpected costs appear.
Debt-to-income ratio FAQs
What is debt-to-income ratio?
Debt-to-income ratio compares monthly debt payments with gross monthly income. It is shown as a percentage.
How do I calculate debt-to-income ratio?
Add monthly debt payments, divide by gross monthly income, then multiply by 100. For a housing-inclusive version, add rent or mortgage payments too.
Should rent or mortgage be included in DTI?
It depends on the purpose. Debt-only DTI focuses on borrowing commitments. Housing-inclusive DTI gives a wider view of monthly pressure.
Is a lower debt-to-income ratio better?
Generally, yes. A lower ratio means less of your income is already committed to debt payments.
Does DTI affect borrowing?
Lenders may consider your income and existing commitments during affordability checks, but each lender uses its own criteria.
Key terms used in this calculator
These glossary terms explain the borrowing and affordability language used on this page.