What is a debt-to-income ratio (DTI)?

Your debt-to-income ratio (DTI) is all your monthly debt payments divided by your gross monthly income. This number is one way lenders measure your ability to manage the monthly payments to repay the money you plan to borrow.

Different loan products and lenders will have different DTI limits.

How do I calculate my debt-to-income ratio?

To calculate your DTI, you add up all your monthly debt payments and divide them by your gross monthly income. Your gross monthly income is generally the amount of money you have earned before your taxes and other deductions are taken out. For example, if you pay $1500 a month for your mortgage and another $100 a month for an auto loan and $400 a month for the rest of your debts, your monthly debt payments are $2,000. ($1500 + $100 + $400 = $2,000.) If your gross monthly income is $6,000, then your debt-to-income ratio is 33 percent. ($2,000 is 33% of $6,000.)

A mortgage debt-to-income (DTI) ratio compares your monthly gross debt payments to your gross monthly income. Maximum allowed DTI limits vary significantly by loan program, generally spanning from 41% up to 50% or higher for automated underwriting systems. Front-end DTI tracks housing costs, while back-end DTI tracks total recurring debts.

DTI Limits by Mortgage Program

  • Conventional Loans (Fannie Mae / Freddie Mac): Standard guidelines prefer a 28% front-end and 36% back-end ratio, but automated underwriting systems (like Desktop Underwriter) regularly approve qualified borrowers with total back-end DTIs up to 50%.

  • FHA Loans: Typically target a 31% front-end and 43% back-end ratio, but can stretch higher (often up to 47% / 57% with strong compensating factors and automated approval).

  • VA Loans: The Department of Veterans Affairs has no hard cap on DTI, but recommends a 41% back-end ratio; higher ratios require specific compensating factors and manual review.

  • USDA Loans: Generally enforce a strict target of 29% front-end and 41% back-end DTI, though higher thresholds can be approved via automated underwriting with strong credit and reserves.

If you'd like, share your estimated gross monthly income and total monthly debt payments on our Mortgage Affordability Calculator so we can calculate your current DTI ratio and see which loan types you might qualify for.

Date of Last Revision: August 8, 2026