How to calculate debt to income (DTI) step by step

Learning how to calculate debt to income (DTI) helps you see whether a new payment fits your budget. Lenders use DTI as a planning screen — it is not a credit score and not an approval decision.

The basic formula

Divide your total monthly debt payments by your gross monthly income, then multiply by 100 for a percentage: DTI = (monthly debt payments ÷ gross monthly income) × 100.

What counts as a debt payment

Typically include housing (rent or mortgage principal and interest), auto loans, personal loans, student loans, credit card minimums, and other recurring installment obligations. Do not include groceries, utilities, or discretionary spending unless your lender asks for a broader budget view.

Front-end vs back-end DTI

Front-end focuses on housing costs alone. Back-end includes housing plus all other monthly debts. Many consumer lenders watch back-end DTI more closely for personal and auto loans.

Run your numbers

Use our debt-to-income calculator to estimate front-end and back-end ratios. If DTI is high, prioritize debt reduction before adding a new installment payment — model that payment in the installment loan calculator or personal loan calculator.

Estimates only — not underwriting advice. See methodology for assumptions.