Calculate the ratio, then confirm the inputs
Write down your recurring monthly debt obligations and proposed housing payment. Divide their qualifying total by gross monthly income. Programs and lenders differ in how they treat particular debts and income, so a household worksheet is only a starting point. CFPB — Debt-to-income ratio ↗
DTI is different from a comfortable budget
A qualifying ratio does not tell you how much remains for childcare, groceries, savings, or repairs. Build a separate household budget using take-home pay. Leave room for expenses that an underwriting ratio may not capture.
Ask what was included
When reviewing a proposed loan, request the income amount, debt total, proposed housing payment, and underwriting method used. If a debt will be paid off, ask what evidence is needed before assuming it can be excluded. Avoid treating a percentage found online as an approval guarantee.
PUT IT INTO PERSPECTIVE
An example, not an offer
Illustration only: $3,600 in qualifying monthly debt divided by $9,000 in qualifying gross monthly income equals 0.40, or 40% DTI. This is arithmetic, not a program limit or approval.
Review your purchase budget →Related questions
Check the original guidance
Requirements and availability can change. Confirm the program and lender terms for your application.