Business Tools

Free Debt-to-Income (DTI) Ratio Calculator

DTI is the first metric every lender computes on a loan application. It tells them what share of your monthly income is already committed to debt. This calculator adds up every loan payment, rent and minimum-due, divides by income and returns a color-coded rating.

Monthly debt payments
$
$

Results

Total monthly income$8,000.00
Total monthly debt$1,800.00
DTI ratio22.5%
Lender view: Healthy (< 33%)
0%33%50%100%

Disclaimer: This calculator provides estimates only and does not constitute financial advice. Actual loan terms may vary by lender.

What the Debt-to-Income Calculator does

Debt-to-income (DTI) ratio measures what share of a borrower's gross monthly income is already committed to debt payments. It is one of the first figures lenders calculate on any loan application, because it estimates how much financial cushion a borrower has before taking on new debt.

Methodology and formula

DTI (%) = (Total Monthly Debt Payments / Gross Monthly Income) x 100, including all loan installments, minimum credit-card dues and (in most markets) rent.

Worked example

Inputs
Gross monthly income 6,000; existing loan payment 900; credit-card minimums 150; rent 1,050.
Result
Total monthly debt 2,100; DTI 35%.

At 35%, this borrower sits just above the comfortable under-33% band, so a lender may ask for a guarantor or collateral rather than declining outright. Paying off the smaller credit-card balance would bring DTI back under 33%.

When to use this tool

Use this to check personal borrowing capacity before applying for a loan. Use the Loan Eligibility Calculator to translate that capacity into a maximum loan amount, or the Working Capital Calculator when the borrower is a business rather than an individual.

About the Debt-to-Income Calculator

The DTI formula

DTI (%) = (Total Monthly Debt Payments / Gross Monthly Income) × 100. Include every loan payment, credit-card minimum due, rent (in most markets), and any other recurring debt. Exclude utilities, groceries and other non-debt expenses.

How lenders read the number

Under 33% is comfortable — most lenders approve without extra scrutiny. 33–50% requires stronger justification (higher income, collateral, guarantor). Above 50% is usually declined for unsecured loans.

Improving DTI before you apply

Two levers: pay down or close the smallest debts to reduce the numerator, or increase documented income (a raise, a side business). Closing an unused credit card can also help — the minimum due disappears from the calculation.

Frequently asked questions

What is a good debt-to-income ratio?

Below 33% is considered healthy by most lenders. Between 33% and 50% is a caution zone. Above 50% typically leads to rejection for unsecured credit.

Should I include rent as debt?

Most lenders do include rent when they compute your DTI, so this tool includes it as an optional field.

Does DTI use gross or net income?

Gross monthly income — before tax and other deductions. That's the standard lenders use.

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