What is DTI Calculator?
The Debt-to-Income (DTI) Calculator helps you determine your financial health by comparing your total monthly debt payments to your total monthly income. This percentage shows how much of your income goes toward paying debts, which is essential for lenders when approving loans.
How to Use?
- Choose whether you want to calculate on a Monthly or Yearly basis.
- Enter your income details under “Gross Incomes”.
- Enter all your debt and expense details under “Debts / Expenses”.
- Click on Calculate DTI to view your Debt-to-Income ratio.
- Analyze your DTI result and see the top 3 expense categories in the round chart.
How to Calculate Debt-to-Income (DTI) Ratio
The Debt-to-Income (DTI) ratio helps you measure how much of your income goes toward paying debts. It’s a key factor used by lenders to assess your creditworthiness and loan eligibility.
🧮 DTI Formula:
DTI Ratio = (Total Monthly Debt Payments ÷ Gross Monthly Income) × 100
📘 Example Calculation:
Suppose your total monthly loan and credit payments are $4000, and your monthly income is $10000.
Using the formula:
DTI = (4000 ÷ 10000) × 100 = 40%
This means 40% of your income goes toward paying debts. Generally, a lower DTI ratio indicates better financial health and higher loan eligibility.
What is a Good Debt-to-Income Ratio?
Your Debt-to-Income (DTI) ratio shows how much of your monthly income goes toward debt payments. Lenders use it to assess your financial stability and loan repayment capacity. Generally, a lower DTI ratio means better financial health and higher creditworthiness.
📊 DTI Range & Details
| DTI Range | Category | Details |
|---|---|---|
| 0% – 20% | Excellent | Very healthy financial balance. You can easily manage debts and qualify for most loans. |
| 21% – 35% | Good | Stable situation. Manageable debt levels, likely to be approved for most credit applications. |
| 36% – 43% | Acceptable | Moderate risk level. Lenders may approve loans but with tighter conditions or higher rates. |
| 44% – 50% | High | Debt is taking up a large portion of income. You should reduce liabilities to improve financial health. |
| Above 50% | Critical | Too much debt. Loan applications are likely to be denied until you lower your DTI. |
