What if my front-end and back-end DTI limits disagree?

The lower, more restrictive number governs, since both caps must be satisfied at once. A borrower can pass the back-end 43% test with room to spare but still be capped by a stricter front-end limit (often 28%-31%) on the housing payment alone.

Debt-to-Income (DTI) Calculator

Q: What is a good debt-to-income ratio?

Under 36% back-end DTI is the classic benchmark for comfortable finances. Conventional mortgages generally want 43%-45% or lower, and 50% is a hard ceiling for most programs. Under 20% is excellent.

Q: What counts as debt in a DTI calculation?

Recurring monthly obligations: rent or mortgage payments, car loans, student loans, personal loans, credit card minimum payments, alimony, and child support. Utilities, groceries, insurance premiums, and subscriptions do not count.

Q: Is DTI calculated on gross or net income?

Gross income — before taxes and deductions. That's how every lender computes it, which is why a DTI that sounds comfortable can still feel tight in your actual take-home budget.

Q: How does a co-signed loan affect my DTI?

A co-signed loan generally counts fully against the co-signer's DTI, even if the other borrower has been making every payment — unless the co-signer can document, typically with 12 months of statements, that someone else has consistently paid it. This is a common trap for parents who co-signed a child's car or student loan.

The first number a mortgage underwriter checks. Calculate your front-end and back-end DTI exactly the way lenders do, and see where you stand against their cutoffs.

Written by the Calculator Index team · Last reviewed September 2026

Back-end DTI (all debts)

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Front-end DTI (housing)

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Total monthly debt

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Rating

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Room under 36%

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The DTI formulas

Front-end DTI = Housing payment ÷ Gross monthly income × 100
Back-end DTI = All monthly debt payments ÷ Gross monthly income × 100

Worked example

Income $7,000/mo · housing $1,800 · car $450 · student loans $250 · cards $100

Front-end: 1,800 ÷ 7,000 = 25.7% · Back-end: 2,600 ÷ 7,000 = 37.1% — just over the 36% benchmark, so paying down the car or cards would help before a mortgage application.

How lenders read your DTI

Back-end DTI	What lenders see
< 20%	Excellent — very low risk
20–36%	Healthy — comfortably qualifies
36–43%	Acceptable — most conventional loans still work
43–50%	Stretched — limited programs, compensating factors needed
> 50%	Generally declined

To lower your DTI you can raise income or shrink the numerator: pay off the smallest debts entirely (each eliminated payment drops the ratio immediately — see the debt payoff calculator), avoid new financing before a mortgage application, and consider consolidating high-payment debt. Then check what your improved ratio buys you in the house affordability calculator.

Worked example — reverse calculation: how much mortgage payment qualifies

Instead of checking an existing DTI, work backward from lender caps to find the maximum new housing payment. Income $7,000/mo; existing non-housing debt: car $450 + student loans $250 + cards $100 = $800/mo.

Back-end cap (43%): max total debt = 7,000 × 0.43 = $3,010 → max new housing payment = 3,010 − 800 = $2,210/mo.

Front-end cap (31%, typical for FHA-backed loans): max housing payment = 7,000 × 0.31 = $2,170/mo.

The lower of the two governs: $2,170/mo is the most housing payment this income qualifies for, $40 less than the back-end math alone would suggest, because both caps must be satisfied at the same time.

Common DTI mistakes

Leaving the proposed housing payment out of the calculation. When qualifying for a new mortgage, lenders add in the new payment even if you're currently renting for less — running your DTI on only your existing debts will overstate how much room you actually have.
Counting the full card balance instead of the minimum payment. DTI only cares about the required minimum due each month, not what's owed overall — a $10,000 balance with a $200 minimum counts as $200, not the balance.
Forgetting a co-signed loan. A loan you co-signed generally counts fully against your own DTI even if someone else makes every payment, unless you can document a consistent payment history from them (see the FAQ below).

Frequently asked questions

What is a good debt-to-income ratio?

Under 36% back-end is the classic benchmark; conventional mortgages typically want ≤43–45%; under 20% is excellent.

What counts as debt in a DTI calculation?

Recurring obligations: housing, car, student and personal loans, card minimums, alimony, child support. Utilities, groceries, and subscriptions don't count.

Is DTI calculated on gross or net income?

Gross (pre-tax) income — the same way every lender computes it.

How does a co-signed loan affect my DTI?

It generally counts fully against you, even if someone else pays it — unless you can document, usually with 12 months of statements, that they've consistently made the payments.

What if front-end and back-end limits disagree?

The lower, more restrictive number governs. You can pass the 43% back-end test with room to spare and still be capped by a stricter front-end limit (often 28-31%) on housing alone.

Related calculators

Note: Lender DTI limits vary by loan program and compensating factors. Not financial advice. Last reviewed: September 2026.