Debt-to-Income Ratio (DTI)
Lending & MortgagesThe percentage of monthly gross income that goes toward paying debts, used by lenders to assess borrowing capacity.
Example
Example: You earn $6,500/month gross. Monthly debts: $1,800 mortgage, $350 car payment, $200 student loans, $100 credit card minimums = $2,450 total. Your DTI is $2,450 / $6,500 = 37.7%. Most lenders want this below 43%. To qualify for a better rate, you could pay off the car ($350/month), dropping DTI to 32.3%. Use our DTI calculator.