Debt-to-Income Ratio Calculator
Selecting a country changes the ratio name, calculation method and guidance.
Advanced options and modes
Mixing gross and net income in the same calculation invalidates the comparison. If you select net, all output labels will say "net" instead of "gross."
Lenders verify and may average or discount self-employment income differently. The figure you enter is the amount used in this planning calculation.
Enter living costs to see budget pressure alongside the lender-style ratio.
These are educational planning targets, not lender limits.
How to calculate your debt-to-income ratio
Add up your monthly debt payments that a lender would consider qualifying obligations: mortgage or rent, auto loans, student loans, minimum credit-card payments, personal loans and other required payments like alimony. Divide that total by your gross monthly income before taxes and deductions. Multiply by 100. For example, $2,000 in monthly debt divided by $6,000 in gross monthly income equals 33.3%.
This same structure appears under different names in different markets. In Canada it splits into GDS and TDS. In India it is called FOIR. In the UK and Australia, lenders also express the relationship as a multiple of annual income rather than a monthly percentage.
What is a good debt-to-income ratio?
There is no single number that guarantees approval. Lenders and regulators treat the ratio differently depending on the country, the loan product and the borrower's full profile.
| Market | Common planning range | Key context |
|---|---|---|
| United States | Below 36% often cited; thresholds vary by credit profile and down payment | No universal maximum. Fannie Mae and Freddie Mac reference 36% but allow higher with compensating factors. |
| Canada | GDS under 39% and TDS under 44% for CMHC insured mortgages; conservative guides sit at 32% and 40% | CMHC restricts GDS to 39% and TDS to 44% for specified insured mortgages. Uninsured limits differ. |
| United Kingdom | LTI below 4.5x at portfolio level | The Bank of England flow limit keeps lending at or above 4.5x within 15% of a large lender's new mortgages in aggregate. Since July 2025 an individual lender can exceed its own share while the aggregate limit holds. It is a portfolio rule, not a personal pass or fail. |
| Australia | DTI below 6x | From 1 February 2026 APRA limits new lending at a DTI of 6 or above to 20% of each lender's new owner-occupier and investor loans, on top of a 3 percentage point serviceability buffer. Both are limits on the lender's book, not a personal ceiling. |
| India | FOIR 40% to 50% commonly referenced | FOIR is one of several eligibility inputs. Thresholds are lender-specific. |
What counts toward DTI?
Commonly included in qualifying debt
- Mortgage payment. Principal, interest, property tax, homeowners insurance, mortgage insurance and HOA fees in the US. In Canada, GDS includes heating and a share of condo fees. In the UK, council tax is part of affordability outgoings, not the debt numerator.
- Auto loans. The monthly payment on any financed vehicle.
- Student loans. The scheduled payment. In the US, some lenders use 0.5% to 1% of the balance when a payment is $0 or deferred. In the UK, student loans are a payroll deduction affecting take-home pay, not a qualifying debt.
- Credit cards. In the US the statement minimum is typical. In Canada, 3% of the outstanding balance is the default. In Australia, lenders commonly assess repayment on the credit limit.
- Personal loans. The contractual monthly payment. Estimate payments with the Personal Loan Calculator.
- Other required payments. Alimony, child support and court-ordered obligations.
Treated differently by market or lender
- Rent. Included when assessing existing debt load; excluded when buying and replacing rent with a mortgage in most markets.
- Co-signed debts. May or may not be included depending on whether you are the primary obligor.
- Buy-now-pay-later. Increasingly scrutinised but not universally treated as qualifying debt yet.
- Rental income. May offset the rental property mortgage at a discount.
- Self-employment income. Lenders typically average over two years and may discount it. See the Mortgage Affordability Calculator for related planning.
DTI for mortgage applications
Mortgage lenders use the debt-to-income ratio as one of several qualifying metrics, alongside credit history, down payment, reserves and loan-to-value. In the US, the front-end ratio isolates housing costs. The back-end ratio wraps everything together. Lenders selling to Fannie Mae or Freddie Mac commonly reference 36% back-end but approve above it with compensating factors.
The Mortgage Calculator breaks down principal, interest, tax and insurance. The Mortgage Overpayment Calculator shows the impact of overpayments on total interest. Existing homeowners can check equity with the Home Equity Calculator.
Debt-to-income ratio to buy a house
House purchase planning starts with your current back-end DTI, then models what happens when the new mortgage replaces rent. This calculator's proposed-mortgage mode shows your current ratio side by side with the ratio after the new loan, plus the change in percentage points. The result is a planning estimate, not a qualification. Use the Mortgage Affordability Calculator to explore price ranges, or the Rent vs Buy Calculator to compare renting against purchasing.
How DTI works in the UK
UK lenders do not rely on a single DTI percentage. They assess affordability by examining gross income, committed outgoings, living costs and a stressed interest rate. The primary headline metric is the loan-to-income multiple (LTI), the loan size as a multiple of annual income. The Bank of England flow limit applies at the lender's portfolio level, keeping lending at or above 4.5x within 15% of new mortgages in aggregate, so it is not an individual pass or fail. A monthly commitments view, shown here as a secondary metric, is a budgeting perspective. Student loans in the UK are deducted from pay at source and affect take-home pay. They are not treated as a qualifying debt payment. Council tax and utilities sit in the living-costs assessment.
How DTI and GDS/TDS differ in Canada
Canada uses two named ratios. Gross Debt Service (GDS) measures housing costs alone: mortgage principal and interest, property taxes, heating and the applicable share of condo fees (typically 50%), divided by gross monthly income. Total Debt Service (TDS) takes the GDS numerator and adds all other debt obligations. CMHC sets maximums of 39% GDS and 44% TDS for insured mortgages, but uninsured and lender-specific limits may differ. The stress test requires qualifying at the greater of the Bank of Canada benchmark rate or the contract rate plus two percentage points.
How debt-to-income works in Australia
Australian lenders express DTI as a multiple of gross annual income. $600,000 in total debt against $150,000 in gross annual income is a 4.0x multiple. From 1 February 2026 APRA limits new lending at a DTI of 6 or above to 20% of each lender's new owner-occupier and investor loans. Lenders also assess a serviceability buffer of 3 percentage points above the product rate, and evaluate credit-card limits rather than just balances. Both rules constrain the lender's book rather than setting a personal cap. This calculator shows the multiple as the primary metric and the monthly commitment burden as a secondary view.
FOIR vs DTI in India
Fixed Obligation to Income Ratio (FOIR) is the Indian-market term for the monthly-payment-to-income calculation. It includes existing EMIs, credit-card dues, rent and other fixed monthly outgoings divided by gross monthly income, multiplied by 100. FOIR is one of several eligibility checks; lenders also evaluate credit score, employment type and tenure. Currency here uses Indian digit grouping, so one lakh appears as ₹1,00,000.
DTI vs credit utilization
These are different metrics for different purposes. Debt-to-income ratio compares monthly debt payments to monthly income. Credit utilization compares outstanding revolving balances to available credit limits. DTI matters to lenders evaluating whether you can carry a new payment. Credit utilization matters to credit-scoring models evaluating revolving-credit usage. A 30% credit utilization does not translate to a 30% DTI, and vice versa. To reduce credit utilization, pay down balances or request higher limits. To reduce DTI, pay off debt or increase income. For payoff planning, see the Debt Payoff Calculator or the Loan Payoff Calculator.
How to lower your debt-to-income ratio
The ratio moves when either the numerator (debt payments) or the denominator (income) changes. Practical routes include paying off the smallest balance to remove a payment entirely, increasing income through a raise or second job, or refinancing to a lower monthly payment, which may increase total interest cost. The scenario table auto-computes several of these paths so you can compare the impact in percentage points. The Debt Payoff Calculator models payoff timelines and interest savings.
 | Free & Private – CalcNest){kind=link}
0 Comments