Your debt-to-income ratio is your monthly debt payments divided by your gross monthly income, written as a percentage.
TL;DR: Back-end DTI is (housing + all other debt payments) ÷ gross monthly income. The debt-to-income calculator runs both ratios for you.
The two ratios
There are two versions, and lenders look at both.
Front-end DTI is housing only, divided by income. Housing means rent or your mortgage payment plus property tax and insurance if they are bundled in.
Back-end DTI adds everything else: car loans, student loans, credit card minimums, personal loans. That total is divided by the same gross income.
A worked example
Say you earn $6,000 a month before taxes. Your housing payment is $1,500, and your other monthly debt payments add up to $600.
Front-end: $1,500 ÷ $6,000 = 25 percent.
Back-end: ($1,500 + $600) ÷ $6,000 = $2,100 ÷ $6,000 = 35 percent.
So this borrower sits at 25 percent front-end and 35 percent back-end. Plug the same figures into the debt-to-income calculator and you get the same two numbers.
Use gross income, and what the thresholds mean
Always use gross income, the amount before taxes and deductions, not your take-home pay. Using net income makes your ratio look worse than the number a lender will calculate, so you would be comparing against the wrong yardstick.
For reference, a 28 percent front-end and 36 percent back-end is widely considered comfortable. FHA loans can stretch to about 31 percent front-end and 43 percent back-end. The 35 percent in the example above falls under both back-end limits, which is a reasonable position.
These ratios are informational. Lenders set their own cutoffs and weigh credit score, down payment, and reserves alongside DTI, so a number that looks fine here is not a guarantee of approval. This guide is not financial advice.