Calculate Your Debt-to-Income Ratio
Rs 5L
Rs 1L
Rs 1.5L
Rs 50K
Debt-to-Income Ratio
Total Monthly Debts
Available Income
Loan Eligibility Status
DTI Ratio Guidelines
Excellent (0-20%)
Easy loan approval with best rates
Good (20-36%)
Good approval chances, competitive rates
Fair (36-50%)
May qualify with higher rates
Poor (50%+)
Difficulty getting approved
Understanding Debt-to-Income Ratio
Debt-to-income (DTI) ratio is a key financial metric that compares your monthly debt payments to your gross monthly income. Lenders use this ratio to assess your ability to repay loans and manage additional debt.
DTI Ratio = (Total Monthly Debt Payments / Gross Monthly Income) × 100
Example:
Monthly Debts: Rs 40,000
Monthly Income: Rs 1,00,000
DTI Ratio: 40%
Why DTI Ratio Matters
• Loan Approval: Lower DTI increases chances of loan approval
• Interest Rates: Better DTI can help secure lower interest rates
• Loan Amount: Lower DTI may qualify you for higher loan amounts
• Financial Health: Indicates your ability to manage debt responsibly
💡 Tips to Improve DTI Ratio
• Increase Income: Take on additional work or ask for a raise
• Pay Down Debt: Focus on high-interest debts first
• Consolidate Loans: Combine multiple debts into one lower payment
• Avoid New Debt: Don’t take on additional loans or credit
Lender Requirements by Loan Type
• Home Loans: Typically require DTI below 43%
• Car Loans: Usually accept DTI up to 45-50%
• Personal Loans: May accept DTI up to 40-45%
• Credit Cards: Consider DTI along with credit score
What to Include in DTI Calculation
• Include: Credit card minimums, loan EMIs, alimony, child support
• Don’t Include: Utilities, groceries, insurance, taxes (unless delinquent)
• Income: Use gross (before-tax) monthly income
• Variable Income: Use average of last 2 years for self-employed
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