How is Debt-to-Income (DTI) Ratio calculated?
Assume your total monthly expenses for mortgages, car payments, other personal loans, and minimum payments to your credit cards equals $1,500/month and that your gross pay equals $3,000/month. $1,500 divided by $3,000 equals 50%. Your debts are 50% of your income; therefore you have a 50% DTI Ratio.