The Mortgage Plug guide
Understanding DTI
See how monthly debts relate to income before taxes.
Reviewed October 29, 2026 · Atiyah Jemison · NMLS #2162831
What debt-to-income means
Debt-to-income ratio (DTI) compares recurring monthly debt payments with gross monthly income—income before taxes and payroll deductions. Lenders use it as one part of their review, not as an approval by itself.
A simple calculation
Total monthly debt payments ÷ gross monthly income × 100 = DTI. For example, $450 auto payment + $350 credit-card minimums + $1,200 proposed housing payment = $2,000. Dividing $2,000 by $6,000 gross income gives approximately 33.3% DTI.
What belongs in the calculation?
Housing payments and recurring debts such as auto, student, and credit-card payments commonly count. Support obligations may matter too. A lender confirms which payments and income are included under the applicable rules.
DTI is not your entire budget
Groceries, utilities, transportation, maintenance, and savings may not be in the underwriting DTI calculation, but they still affect what you can comfortably afford. No single DTI percentage guarantees qualification; program and individual underwriting requirements vary.
Sources & next steps
Educational guidance only. Eligibility, documentation, loan terms, and property requirements vary by program and underwriting. Use a secure application or approved portal, never email or text, for sensitive financial documents.