Your front-end ratio is your housing payment divided by gross monthly income; your back-end ratio is all monthly debt payments divided by the same income. On $6,500 a month gross with $1,750 housing and $950 of other payments, the front-end ratio is 26.9% and the back-end ratio is 41.5% — inside the housing guideline, above the 36% total-debt guideline.
What counts as a monthly debt — and what does not
The Consumer Financial Protection Bureau (CFPB) defines the measure this way: “Your debt-to-income ratio is all your monthly debt payments divided by your gross monthly income. This number is one way lenders measure your ability to manage the monthly payments to repay the money you plan to borrow.” Two words in that definition do most of the work: payments and gross.
DTI counts monthly payments, never total balances. The housing line is your full housing payment — mortgage principal and interest, property taxes, homeowners insurance, and HOA or mortgage insurance where they apply — or your rent. Beyond housing, count the required payment on each recurring debt: auto loans and leases, student loans, the minimum payments on every credit card combined, personal loans, and court-ordered payments such as child support or alimony. What does not count surprises people: utilities, groceries, gas, phone bills, subscriptions, and insurance premiums that are not already inside the housing payment are living expenses, not debts, and they stay out of the ratio entirely. A $20,000 credit-card balance with a $150 minimum payment enters DTI as $150 — which is also why paying a card down only moves your ratio when the required payment itself falls.
Gross income, not take-home
Lenders use gross (pre-tax) income because it is verifiable from pay stubs and tax documents and comparable across borrowers with different withholding situations. If you are salaried, divide your annual salary by 12. Using your take-home pay instead overstates both ratios — sometimes dramatically — and produces readings no lender would recognize. Enter the gross figure and the verdicts on this page line up with the convention lenders actually use.
The 28/36 convention
The long-standing guideline convention is 28/36: lenders generally prefer a front-end (housing) ratio no higher than 28% and a back-end (total debt) ratio no higher than 36%. It is a convention, not a law and not a pass/fail cutoff — a shared rule of thumb the industry has used for decades to describe a comfortable monthly load. This page reports a separate verdict for each ratio against its own guideline, because the two readings answer different questions: the front-end figure isolates the housing cost on its own, while the back-end figure shows the total weight of every required payment together. A household can sit comfortably inside one guideline and outside the other — the worked example below does exactly that — and a single blended number would hide which side is doing the straining. The CFPB's own consumer guidance (“Your Money, Your Goals”) similarly suggests considering a mortgage DTI of 28–35% or less.
The 43% figure: what it was, and what changed
You will see 43% quoted everywhere as if it were a current ceiling. It was — once. In the CFPB's original General Qualified Mortgage definition (Regulation Z, 12 CFR 1026.43(e)(2)(vi)), a loan's total monthly debt divided by total monthly income could not exceed 43%. The CFPB's General QM final rule removed that fixed 43% DTI limit and replaced it with price-based thresholds (based on the spread between the loan's APR and the Average Prime Offer Rate). Lenders must still consider and verify the borrower's DTI or residual income — the ratio still matters — but there is no longer a single federal 43% line. This page therefore presents 43% exactly as it should be presented: as the former General QM DTI limit, still widely used as a reference point — never as a current legal cap, and never as a line that decides anything about any individual loan.
Programs differ
Limits vary by lender and loan program. Conventional, FHA, VA, and USDA loans each treat DTI differently, and compensating factors such as credit history, cash reserves, and down payment affect decisions alongside the ratios. Some programs consider ratios above the guidelines on this page. Nothing here predicts an outcome on any application — the ratios are the diagnostic, and the reading of them belongs to the lender running your file.
Worked example
A borrower earns $6,500.00 gross per month, pays $1,750.00 for housing, $420.00 on an auto loan, $280.00 on student loans, $150.00 in credit-card minimums, and $100.00 of other debt payments. The calculator is pre-filled with exactly this case:
- Non-housing debts: $420.00 + $280.00 + $150.00 + $100.00 = $950.00
- Total monthly debts: $1,750.00 + $950.00 = $2,700.00
- Front-end ratio: $1,750.00 ÷ $6,500.00 × 100 = 26.9% — within the 28% housing guideline
- Back-end ratio: $2,700.00 ÷ $6,500.00 × 100 = 41.5% — above the 36% guideline but at or below 43%, the former Qualified Mortgage DTI reference point
- Headroom to 36%: (0.36 × $6,500.00) − $2,700.00 = −$360.00 — that is, $360.00 over the 36% guideline
- Headroom to 43%: (0.43 × $6,500.00) − $2,700.00 = $95.00 of room
- Housing at exactly 28%: 0.28 × $6,500.00 = $1,820.00
A renter's version reads differently: on $4,000.00 gross with $1,200.00 rent and no other debts, both ratios are 30.0%, total debts are $1,200.00, headroom is $240.00 to the 36% guideline and $520.00 to the 43% reference, and housing at 28% would be $1,120.00.
How a ratio actually moves
Because DTI runs on payments, the levers are payments. Retiring a loan removes its entire payment from the back-end numerator at once — which is why the last months of a car loan matter more to DTI than the balance suggests. For credit cards, the required minimum is what counts, so a balance reduction moves the ratio only as far as it moves the minimum. If your back-end reading sits above the guideline, the fix-it math lives in our payoff tools: the Debt Snowball vs Avalanche Calculator compares payoff orders across all your debts, and the Credit Card Minimum Payment Calculator shows what a card's minimum is really costing. This page's job is the measurement those plans start from.