Definition
Debt-to-income ratio, or DTI, compares monthly debt payments with gross monthly income.
If you are comparing mortgage options, treat debt-to-income ratio as one piece of the total cost and risk picture, not a standalone detail.
Why It Matters
DTI matters because lenders use it to evaluate whether a borrower can handle a mortgage payment along with existing debts.
Simple Example
If gross income is $6,000 and monthly debts are $2,100, the back-end DTI is 35%.
How to Use This Term
When you see debt-to-income ratio on a loan estimate, calculator result, or lender conversation, connect it to three practical questions: how it affects monthly payment, how it affects cash needed now, and how it affects flexibility later.