# Debt to Income Ratio is Important to Lenders – Debt Ratio

### What is my debt to income ratio or debt ratio?

Calculate your debt to income ratio or what percentage of your monthly income is used to pay fixed monthly costs. Enter your monthly income, monthly rent or mortgage expense, and other monthly expenses. This calculator will then show you your debt to income ratio which is the percentage your monthly income goes to pay monthly debts and expenses. In general, most mortgage lenders do not want your total monthly housing debt ratio or housing expenses (including property taxes, private mortgage insurance (PMI), and association dues) to exceed 28% of your total gross monthly income. And your total debt to income ratio percentage cannot exceed 36% of your total gross monthly income.

## Why should I care what my debt to income ratio percentage (or simply debt ratio) is?

You should care what your debt to income ratio is because banks and other lenders care what it is! The bank doesn’t want to loan you money if you can’t afford to pay it back. Banks control their liability by checking that your debt payments commit only about 36% of your income as total monthly payments. The percentage of your income used to pay fixed monthly expenses like housing and car or other loan payments is your debt to income ratio or just debt ratio.

## Field Help

### Input Fields

Title: A title for these calculator results that will help you identify it if you have printed out several versions of the calculator.

Gross Monthly Salary/Income: Normal monthly income, including taxes, but not including alimony, child support, etc.

Other Monthly Income: Other monthly income such as alimony or child support.

Monthly Rent/Mortgage: The amount you spend each month for rent or mortgage.

Car Payments: The total amount you spend each month for all car payments.

Credit Card Payments: The total amount you spend each month for all credit card payments.

Other Loan Payments: The total amount you spend each month for all loans (not to include mortgage).

Other Monthly Payments: Total of all other monthly obligations you have. (Examples are alimony, child support, legal judgment.)

### Output Fields

Total Monthly Income: Total amount of ‘Monthly Income’ entered.

Total Monthly Expenses: Total amount of ‘Monthly Expenses’ entered.

Housing Debt Ratio: The percentage of your monthly income that goes to pay for housing.

Total Debt Ratio: The percentage of your monthly income that goes to pay all your debt (including housing).