Key Takeaways
- DTI compares your monthly debt payments to your gross monthly income.
- Many loans want DTI under ~43–50%, though it varies by program.
- Lowering debt or raising income improves your DTI and buying power.
- DSCR and asset-based loans skip personal DTI entirely.
Of all the numbers in a mortgage, debt-to-income ratio may be the most important — it often decides how much home you can buy.
What is debt-to-income ratio?
DTI is your total monthly debt payments — including the new mortgage — divided by your gross monthly income, shown as a percentage. It tells the lender how much room you have to take on a house payment.
What’s a good DTI to buy a house?
Under 36% is ideal, but many programs approve up to 43–50% depending on your overall profile. A lower DTI can also earn you a better interest rate.
How do you lower your DTI?
Pay down credit cards and loans, avoid taking on new debt, or increase your qualifying income. Real estate investors can sidestep personal DTI entirely with DSCR loans that qualify on the property’s cash flow.
Frequently Asked Questions
What is a good debt-to-income ratio for a mortgage?
Under 36% is ideal, but many loans allow up to 43–50% depending on the program and your overall profile.
How is DTI calculated?
Add up your monthly debt payments (including the proposed mortgage) and divide by your gross monthly income.
Can I get a mortgage with a high DTI?
Often yes — some programs allow higher DTIs, and DSCR loans for investors don’t count personal DTI at all.
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