Debt-to-income ratio: FAQs

A healthy debt-to-income ratio is an indicator of financial stability. Just as the term implies, this ratio compares the amount of money you pay toward debt against your income.


A stable debt-to-income ratio is anything 43% and lower. Someone with a higher percentage may struggle to make ends meet and keep up with their payments.


When applying for a mortgage, lenders will use this number as a determining factor, so it’s essential to know where you stand. In most cases, you must have a debt-to-income ratio under 43% to get a qualified mortgage when buying a home.


Calculate debt-to-income ratio

The equation looks like this: Total monthly debt payments ÷ monthly gross income (before taxes) = debt-to-income ratio


Here’s an example: Let’s say you make $6000 each month before taxes, and you have an $1800 mortgage, $300 car payment, $150 student loans, and $50 credit card payment.


($1800 + $300 + $150 + $50) ÷ $6000 = debt-to-income ratio

$2300 ÷ $6000 = 0.38

Your debt to income ratio is 38%.


Bills as debt

•  Monthly rent or house payment

•  Auto, student, or other monthly loan payments

•  Monthly alimony or child support

•  Monthly credit card payment

•  Any other debt

This website is not meant to substitute for expert medical advice or treatment. Follow your doctor’s or health care provider’s advice if it differs from what is given in this guide.


The American Institute for Preventive Medicine (AIPM) is not responsible for the availability or content of external sites, nor does AIPM endorse them. Also, it is the responsibility of the user to examine the copyright and licensing restrictions of external pages and to secure all necessary permission.


The content on this website is proprietary. You may not modify, copy, reproduce, republish, upload, post, transmit, or distribute, in any manner, the material on the website without the written permission of AIPM.