Debt-to-Income (DTI) Ratio Calculator
Understand Your Financial Health Before You Buy or Refinance a Home
Your Debt-to-Income (DTI) ratio is one of the most important factors lenders consider when evaluating your ability to qualify for a loan. A lower DTI indicates better financial stability and a higher likelihood of mortgage approval.
✅ What Is DTI?
Your DTI compares your monthly debt payments to your gross monthly income (before taxes). It helps determine how much of your income is going toward paying off debts—and how much you can comfortably borrow.
📌 Why It Matters
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Below 36%: Excellent — You’re in a strong position to apply for a mortgage or refinance.
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36–43%: Acceptable — You may qualify for most conventional or FHA loans.
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Above 43%: Risky — Consider reducing debt or increasing income before applying.
🧾 DTI Formula
DTI=(Total Monthly Debt PaymentsGross Monthly Income)×100
💡 DTI Calculator
Step 1: Enter Your Gross Monthly Income
(before taxes and deductions)
Step 2: Add Your Monthly Debt Payments
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Mortgage or rent
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Auto loans
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Student loans
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Credit card minimums
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Personal loans
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Alimony/child support (if applicable)
Example:
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Income: $6,000
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Mortgage: $1,800
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Car Loan: $400
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Credit Cards: $200
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Student Loan: $300
Your DTI:
(1,800+400+200+3006,000)×100=45%
💬 Need Help Understanding Your Results?
As an experienced real estate broker and financial strategist, I can help you assess your current financial picture and plan your next steps—whether you're buying your first home, refinancing, or investing.
📞 Contact me today for a free consultation.
Finding a Loan Officer
Choosing reliable and knowledgeable loan officer is key for home purchasing, as well as choosing realtor. It is not choosing from lenders, choosing right loan officer make your loan processing smoothly.
Consulting with Loan Officer to determine your budget
When you consider purchasing a home, you must know your budget. Loan officer gives you financial advice, your budget and loan per-approval letter based on you financial information. If you need help to find a good loan officer, your realtor will refer best officers to choose.
Why do you need loan pre-approval letter?
To getting pre-approval letter is very important to know your budget,
and all seller request offer with pre-approval letter.
Pre-approval letter is proof to show seller that buyer can afford to buy
a house when buyer submit an offer.
What do you need to get loan pre-approval?
- W-2 form for the past two years(or complete tax returns if self-employed)
- Most recent pay stubs covering at last 30days
- Last 2months' bank statement of all accounts
- Names, and addresses, and account numbers of all creditors
Tips for a Smooth Loan Approval
DO's and DON'Ts List to avoid any delays with loan application
- DO continue making your mortgage or rent payments
- DO stay current on all existing accounts
- DO keep working at your current employer
- DO keep your same insurance company
- DO continue living at your current residence
- DO continue to use your credit as normal
- DO call your loan officer if you have any questions
- DON'T make a major purchase(car, boat, fur jewelry etc.)
- DON'T apply new credit(even if you seem pre-approval)
- DON'T open new credit cards.
- DON'T transfer any balance from one account to another
- DON'T pay off charge without a discussion with your loan officer first
- DON'T pay off collections without a discussion with your loan officer first
- DON'T buy any furniture before close of escrow
- DON'T close any credit card accounts
- DON'T change bank accounts
- DON'T max out or over charge your credit card accounts
- DON'T consolidate your debt on to 1 or 2 credit cards
- DON'T take out new loan
- DON'T start any home improvement project
- DON'T finance any elective medical projects
- DON'T open new cellular phone account
- DON'T join a new fitness club
- DON'T pay off any loans or credit cards without discussing it with your loan officer