Bonuses, alimony, investment income, etc.
37.6%
Total Debt-to-Income Ratio
£6,250.00
£2,350.00
24%
Housing Costs Only
37.6%
All Debt Payments
Lowering this ratio means moving real money every month
iBudget shows where your income actually goes, so you can find the room to clear debt and bring this number down.
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Front-End (Housing)
24%
Great! You are under the 28% recommended limit for housing costs.
Back-End (Total)
37.6%
Manageable. You should qualify for most conventional loans.
Based on your income and existing debts, here's your maximum estimated housing allowance:
| DTI Target | Max Monthly Payment | Details |
|---|---|---|
| 28% (Ideal) | £1,750.00 | Best interest rates |
| 36% (Standard) | £1,400.00 | Conventional approval |
| 43% (Max) | £1,837.50 | Strict upper limit |
* Estimates only. Excludes down payment, credit score, and interest rate factors.
How the debt-to-income calculator works
Two divisions and one subtraction. Here is the arithmetic this page actually runs, including the rounding and the edge cases.
The formula
G = A ÷ 12 + M · front-end = H ÷ G × 100 · back-end = (H + C + S + R + O) ÷ G × 100- G
- Gross monthly income. The two income fields are on different time bases: the annual box is divided by twelve, the other box is added on as-is.
- A
- Annual gross income, before any tax or payroll deduction. Anything that is not a number is read as zero.
- M
- Other monthly income — bonuses averaged out, maintenance received, investment or rental income. Already monthly, so it is not divided.
- H
- The monthly housing payment exactly as typed. It appears in both ratios and is the only debt in the front-end one.
- C, S, R, O
- Car loans, student loans, credit card minimums and other monthly debts, summed unweighted to give the non-housing total used in the qualification table.
- 0 ÷ 0
- If G is zero both ratios are set to 0 rather than erroring — which is why an empty form reads as an excellent result.
Both percentages are rounded to one decimal place for display (Math.round(x × 10) ÷ 10), so 28.75% shows as 28.8%; the maximum-payment figures are not rounded at all. The qualification table runs three separate lines: max payment at 28% = G × 0.28, at 36% = G × 0.36 − (C + S + R + O), and at 43% = G × 0.43 − (C + S + R + O). Only the lower two subtract your existing debts, and only those two are floored at zero. The rating word comes from the back-end ratio alone and is graded before rounding: 28% or under is Excellent, up to 36% Good, up to 43% Fair, up to 50% High, above that Very High.
The ratio measures pressure on cash flow, not the size of your debts. A student loan balance of $45,000 repaid at $120 a month costs you 120 units of monthly room; car finance of $14,000 repaid at $420 a month costs you 420. As far as this calculation is concerned the smaller debt is three and a half times the problem, which is why the fastest way to move your ratio is usually to clear the debt with the worst payment-to-balance relationship rather than the largest one.
The two ratios answer different questions. Front-end DTI asks whether the roof alone is affordable. Back-end DTI asks whether the roof is affordable given everything else you have already committed to. A household can pass the first comfortably and fail the second badly — a modest housing cost buried under car finance and card minimums is the most common shape of a declined application.
The qualification table inverts the arithmetic: instead of asking what your ratio is, it fixes the ratio at a target and solves for the housing payment that would produce it. At 36%, take 36% of gross monthly income, subtract every non-housing debt payment, and what is left is the room available for housing. Add a car loan and that room shrinks by the exact amount of the payment — which is the whole argument against financing a car in the months before a mortgage application.
A worked example
One US household, run end to end. The arithmetic is identical in any currency — only the 28/36/43 conventions are American.
$96,000 a year, $2,300 housing, $925 of other debt
Worked example- Annual gross income (A)
- $96,000
- Other monthly income (M)
- $0
- Gross monthly income (G)
- $96,000 ÷ 12 + $0 = $8,000
- Housing payment (H)
- $2,300
- Car loan (C)
- $520
- Student loans (S)
- $310
- Credit card minimums (R)
- $95
- Other monthly debts (O)
- $0
- Non-housing debt (C + S + R + O)
- $925
- Total monthly debt
- $2,300 + $925 = $3,225
- Front-end DTI
- $2,300 ÷ $8,000 × 100 = 28.75% → 28.8%
- Back-end DTI
- $3,225 ÷ $8,000 × 100 = 40.3125% → 40.3%
- Max housing payment at 28%
- $8,000 × 0.28 = $2,240
- Max housing payment at 36%
- $8,000 × 0.36 − $925 = $1,955
- Max housing payment at 43%
- $8,000 × 0.43 − $925 = $2,515
Two things fall out of this. First, the 28% row ($2,240) comes out above the 36% row ($1,955), because only the lower rows subtract the $925 of car, student and card payments — the $1,955 is the figure that binds. Second, clearing the car loan alone drops the back-end ratio from 40.3% to 33.8% ($2,705 ÷ $8,000) — out of Fair and into Good — and lifts the 36% housing allowance from $1,955 to $2,475. Clearing the $95 of card minimums instead moves the back-end ratio only from 40.3% to 39.1%, a shift of 1.2 points, however large the balance behind them happens to be.
How to read your result
What a good number looks like, what a bad one actually means, and the fastest ways to move it.
Read the back-end ratio first. Under 36% back-end with front-end under 28% is the shape lenders are relaxed about, and it usually also means there is genuine slack in the month. Between 36% and 43% the answer depends on the rest of your application — deposit, credit history, reserves — and a single extra credit commitment can be the thing that tips it. Above 43%, the honest reading is that new borrowing is unlikely and the priority has changed from qualifying to reducing.
Then look at the gap between the two ratios, because it tells you which problem you have. A high front-end ratio with the back-end not far behind means the house is the problem: you are looking above what the income supports, and clearing debt will not fix it. A wide gap — say 22% front-end against 41% back-end — means the consumer debt is the problem, and that is fixable in months rather than years.
To move the number, target payment size rather than balance size. Clearing one car loan usually removes more monthly obligation than clearing several thousand in card balances, because instalment payments are large relative to the sum owed. Refinancing to a longer term lowers the payment and so the ratio, but raises total interest — it improves the metric without improving your position. Raising gross income works on the denominator and helps both ratios, though lenders want a track record before counting new or variable income.
For scale: US median household income was $83,730 in 2024, about $6,978 a month gross, which puts a 28% housing limit near $1,954 — against a median existing-home price of $440,600 in June 2026 and a 30-year fixed rate averaging 6.69% in the week ending 6 August 2026 on Freddie Mac's survey. That combination is why NAR's Housing Affordability Index sat at 102.3 in June 2026: a median-income family had only just the income needed for a median-priced home, and no more. In the UK the squeeze arrives through a different mechanism — the average English home cost 7.6 times median full-time earnings in 2025. A high ratio is a common condition, not a personal failing.
$104,207
US average household income before tax
2024. This is the gross figure the calculator's income box asks for — but it is a mean per 'consumer unit', so it sits well above the typical household.
Source: US Bureau of Labor Statistics, Consumer Expenditure Surveys
$83,730
US median household income
2024, and the better yardstick for a typical household — about $6,978 a month gross, which puts a 28% front-end limit near $1,954.
33.4%
Share of the US household budget going on housing
2024, ahead of transportation at 17.0% and food at 12.9%. Note this is a share of spending, not of gross income, so it is not directly comparable with a 28% front-end DTI.
Source: US Bureau of Labor Statistics, Consumer Expenditure Surveys (Table B)
$440,600
US median existing-home sale price
June 2026, an all-time high and the 36th straight month of annual growth. NAR's Housing Affordability Index stood at 102.3 that month, meaning a median-income family had only just the income needed to qualify.
Source: National Association of REALTORS, Existing-Home Sales
99% vs 131%
Household debt as a share of net disposable income, US vs UK
2024. This is the national version of your ratio — stock of debt against annual income, not monthly payments — and it fell in both countries over the year. Australia sits at 210% and Canada at 181%.
£1,388
UK average monthly private rent
June 2026, up 3.3% over the year. For a UK renter this is the number that goes in the housing box today; London averaged £2,302 and the North East £781.
Source: Office for National Statistics, Price Index of Private Rents
What this calculator does not account for
A ratio this simple buys its clarity by ignoring things. These are the specific things it ignores, so you can judge how far to trust the result.
Gross income, so tax is invisible
Every ratio here divides by pre-tax income, because that is the lending convention. The calculator therefore cannot see your effective tax rate, pension or 401(k) contributions, or payroll-deducted health premiums. Two people with identical 36% ratios can have very different amounts of money actually arriving in the bank.
The housing box does not build PITI for you
Nothing here adds property tax, homeowners or buildings insurance, private mortgage insurance, HOA dues, service charge, ground rent or Council Tax. Enter only the principal-and-interest figure from a mortgage quote and your front-end ratio is understated, sometimes badly. Use the full monthly housing cost your lender will escrow or assess.
It only sees debt, and life costs more than debt
Childcare, commuting, utilities, groceries and medical bills are excluded by design. That is genuinely how the ratio is defined, but it is why a 30% DTI can still be unaffordable — housing alone took 33.4% of the average US household budget in 2024, and the ratio looks at none of the rest.
The 28% row is a front-end number in a back-end table
In the qualification table, the 28% row is gross monthly income × 0.28 with nothing subtracted, while the 36% and 43% rows subtract your non-housing debts first. The three rows are therefore not a ladder, and with enough car and card debt the 28% figure will exceed the 36% one. When it does, the lower figure is the binding one.
No credit score, deposit, loan-to-value or employment history
DTI is one input into an underwriting decision and this page models only that input. It knows nothing about your credit file, your deposit, the LTV band you would land in, your time in employment, your cash reserves, or how a lender stress-tests a rate rise. A comfortable ratio on a thin file still gets declined.
It uses your actual payment, not the payment a lender would count
Deferred student loans, income-driven repayment plans, 0% promotional balances and balloon-payment car finance all cost something different from what underwriting will apply — several programmes substitute a percentage of the outstanding balance when the real payment is zero. The calculator has no such rule; it adds the five numbers you give it.
Edge cases: zero income reads as excellent, and the rating is graded before rounding
With both income fields blank the divide-by-zero guard sets both ratios to 0, and 0% sits inside the excellent band — a green result for someone with no income. Negative numbers are accepted without complaint. The displayed percentages are rounded half-up to one decimal (28.75% shows as 28.8%), but the rating word is graded on the unrounded ratio while the two coloured guidance panels read the rounded one, so at a band edge they can disagree: a back-end ratio of 36.04% prints as 36%, is rated Fair by the headline, and still gets the under-36% message in the panel below. The 36% and 43% maximum payments are floored at zero rather than going negative.
The bands are US conventions and do not change with the currency
The currency symbol follows your locale; 28%, 36% and 43% do not. UK, Irish, Canadian and Australian lenders run loan-to-income multiples and stressed affordability assessments rather than a single DTI threshold, so outside the US the rating word is a health check, not a verdict on an application.
One month, frozen
This is a snapshot with no time dimension. It does not amortise anything, does not know your car loan has eleven payments left, and does not model a fixed rate expiring onto a higher one. Two households showing the same 38% today can be a year and a decade from being debt-free.
None of that makes the ratio useless. It is the number a lender will compute about you whether or not you compute it first, and knowing it before an application is worth far more than the precision it lacks. It does mean that a result in the comfortable bands is not proof a payment is affordable, and a result in the alarming bands is a prompt to get advice rather than a verdict. New clients of the UK charity StepChange owed an average of £16,874 in unsecured debt in 2025, with a median of £9,999; at those levels, free advice is worth more than any ratio.
Frequently asked questions
The awkward ones included.
What is a debt-to-income ratio, exactly?
It is one month of committed debt payments divided by one month of gross income, expressed as a percentage. It measures cash-flow pressure, not how much you owe — a £40,000 balance being repaid at £150 a month affects your DTI far less than a £6,000 balance being repaid at £400. That is why paying off a small, high-payment debt can move the ratio more than paying off a much larger one.
What is the difference between front-end and back-end DTI?
Front-end DTI counts only the housing payment against your gross income. Back-end DTI counts every debt payment, housing included. This calculator shows both: the headline figure and the rating word are the back-end ratio, and the front-end ratio sits in the panel beside it. Most lending decisions lean on the back-end number, but a front-end ratio well above the rest of your file is what usually triggers questions.
Should I enter gross or net income?
Gross — the pre-tax figure, before income tax, National Insurance, Social Security, pension or 401(k) contributions and health premiums come out. The calculator divides the annual box by twelve and adds the 'other monthly income' box on top, so the annual field is yearly and the other field is monthly. Mixing those up is the most common way to get a badly wrong answer here.
Which debts count, and which do not?
Count contractual monthly obligations: rent or the mortgage payment, car finance, student loans, credit card minimums, personal loans, buy-now-pay-later instalments, and court-ordered maintenance or child support. Leave out utilities, groceries, childcare, standalone insurance premiums and everything else that is spending rather than borrowing. The calculator has no view on what goes in each box — it simply adds the five debt fields together.
I rent — should rent go in the housing box?
Yes, if you want a picture of your finances today. No, if you are testing a future mortgage: replace the rent with the payment you expect on the new loan, including property tax and insurance where those are escrowed with the mortgage. Underwriting looks at the housing cost you will have after completion, not the one you are leaving behind.
Why is the 28% maximum payment sometimes higher than the 36% one?
Because the two rows answer different questions and the calculator does not hide it. The 28% row is a pure front-end figure — gross monthly income multiplied by 0.28, with no deduction for your other debts. The 36% and 43% rows are back-end figures, so your car loan, student loan and card minimums are subtracted first. If you carry a lot of non-housing debt, the 36% row can land below the 28% row, and when that happens the lower of the two is the number that binds.
What DTI do I actually need for a US mortgage?
There is no single threshold, which is why this page gives you three. The 43% figure most people have heard comes from the qualified-mortgage framework, but automated underwriting at the major agencies and government-insured programmes routinely approve higher ratios where there are compensating factors such as a large down payment, cash reserves or a strong credit history. Treat 28/36/43 as the bands this calculator uses, then ask the lender you are applying to for their own overlay.
Do UK lenders use debt-to-income?
They look at it, but it is not the headline test. A UK affordability assessment leads on loan-to-income multiples and a stressed-payment calculation — could you still pay if rates rose — with your credit commitments feeding into the income left over. ONS put the average home in England at 7.6 times median full-time earnings in 2025, £300,000 against £39,300. The bands on this page are US conventions, so read them as general guidance rather than UK underwriting rules.
Do I include my partner's income and debts?
Include both or neither. On a joint application, add both gross incomes and every debt payment either of you makes, because that is the file the lender assesses. If only one of you is applying, use only that person's income and debts, except where a debt is in joint names. Running it both ways is often revealing — a second income lifts borrowing power, and a second car loan can wipe the gain out.
My income varies — I am self-employed or on commission. What do I enter?
Enter a figure you could defend with documents, which usually means an average of the last two years' declared profit or earnings rather than your best recent month. Lenders assessing self-employed applicants typically average across years and discount volatile components, so an optimistic input produces a ratio no underwriter will reproduce. Run it once on your average and once on your worst twelve months.
What about student loans that are deferred or on income-driven repayment?
The calculator uses exactly the number you type, so a deferred loan entered as zero contributes nothing. Real underwriting often does not work that way — several programmes impute a payment from the outstanding balance when the actual payment is zero or income-contingent. If that applies to you, ask what figure your lender will use and enter that instead of your current bill.
Does my debt-to-income ratio affect my credit score?
No. Your income is not on your credit report, so no scoring model can see this ratio. What scores do react to is credit utilisation — the share of your available revolving credit you are using — which is a different calculation with a different denominator. You can have an excellent score and a DTI that gets a mortgage declined, and the reverse happens too.
Where to go next
What to read once you have a number, and the other calculators that pair with this one.
Read next
- Dealing with Debt in the UK: Your Complete Guide to Debt SolutionsWhat to do when the ratio is high enough that no mortgage application is the real problem — debt management plans, DROs, IVAs and where free advice comes from.
- How Much Mortgage Can I Afford? (Calculator Guide)Turns the maximum monthly payment this page gives you into a purchase price, once loan-to-value and the interest rate are in the picture.
- Debt Snowball vs Avalanche: Which Payoff Method Is Right for You?Two ordering rules for clearing the non-housing debts that are dragging your back-end ratio up, with the cost of each spelled out.
- 10 Proven Ways to Improve a Bad Credit Rating in the UKThe other half of an underwriting decision, and the one your debt-to-income ratio cannot see.
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