Calculate Your DTI Ratio
Calculate your debt-to-income ratio — the key number mortgage lenders use to determine how much you can borrow.
What Is DTI?
Debt-to-Income ratio compares your monthly debt payments to your gross monthly income. Front-end DTI includes only housing costs (mortgage, property tax, insurance, HOA). Back-end DTI includes all debts (housing + car + student loans + credit cards + other). Lenders use back-end DTI as the primary qualification metric.
DTI Requirements by Loan Type
Conventional: Max 43-45% back-end DTI, 28% front-end. FHA: Max 50% with compensating factors (high credit score, reserves). VA: No hard cap but 41% is the guideline. Jumbo: Typically 36-43% max. The lower your DTI, the better your rate and the more loan options available. Below 36% gets you the best terms.
The single most impactful DTI improvement: pay off credit card balances. Credit cards have the highest minimum payment relative to balance of any debt type. Paying off $5,000 in credit card debt eliminates roughly $150/month in minimum payments — a 2-3% DTI improvement on a typical income.
