Debt-to-Income Ratio (DTI)

The share of your gross monthly income that goes toward debt payments.

DTI divides total monthly debt payments (mortgage or rent, car loans, credit cards, student loans) by gross monthly income. Lenders use it as a key affordability check — a high DTI signals that a large share of income is already committed, leaving less room for a new loan payment or for a bad month.

Worked Example

Someone earning $6,000/month with $1,800/month in mortgage plus $400/month in other debt has a DTI of ($1,800 + $400) ÷ $6,000 = 36.7% — a level many mortgage lenders treat as the upper edge of comfortable.

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