What DTI ratio do lenders typically use?

It varies by loan type and lender, but 36% is a commonly cited conventional guideline, with some programs allowing higher ratios (up to around 43-50%) for qualified borrowers.

Does this account for taxes, insurance, or other fees?

No — this estimates the loan amount itself based on a target payment. For a mortgage specifically, remember property tax and insurance add to your real monthly housing cost (see the Mortgage Calculator).

Loan Affordability Calculator

Estimate the maximum loan amount you can afford based on your income, existing debt, and a target debt-to-income ratio.

Gross monthly income

Existing monthly debt

Target debt-to-income

Interest rate

Loan term

months

Maximum Affordable Loan

$262,629.96

How It Works

Setting a debt-to-income target

Lenders typically cap total monthly debt payments (including the new loan) at a percentage of gross monthly income — commonly around 36%, though this varies by lender and loan type.

Working backward to a loan amount

Your target DTI and income set a maximum total debt payment. Subtracting your existing debt payments leaves what's available for a new loan payment, which is then converted into a maximum loan amount at your expected rate and term.

Example Calculation

With $6,000 gross monthly income, $200 in existing debt, and a 36% DTI target, about $1,960/month is available for a new loan payment.

Common Mistakes

Forgetting to include ALL existing monthly debt payments (car loans, student loans, credit cards), not just one or two.
Assuming the maximum affordable loan is the same as a comfortable one — lenders' maximums often leave little room for other expenses or savings.

Frequently Asked Questions

What DTI ratio do lenders typically use?: It varies by loan type and lender, but 36% is a commonly cited conventional guideline, with some programs allowing higher ratios (up to around 43-50%) for qualified borrowers.
Does this account for taxes, insurance, or other fees?: No — this estimates the loan amount itself based on a target payment. For a mortgage specifically, remember property tax and insurance add to your real monthly housing cost (see the Mortgage Calculator).