What Debt-to-Income Ratio Do You Need for a Mortgage?

"There is no single debt-to-income ratio (DTI) for every mortgage. For conventional loans sold to Fannie Mae, the limit is 36 percent on manually underwritten loans, up to 45 percent if you meet extra credit score and savings rules, and up to 50 percent when the loan runs through Fannie Mae's automated system. For manually underwritten FHA loans, the standard is 31 percent for housing and 43 percent for total debt.

What is a debt-to-income ratio?

The Consumer Financial Protection Bureau (CFPB) (checked Sept. 27, 2026) defines it simply: your DTI is all your monthly debt payments divided by your gross monthly income. Gross income is generally what you earn before taxes and other deductions come out.

Lenders use it to judge whether you can handle the new mortgage payment on top of what you already owe. The CFPB also notes that different loan products and lenders have different DTI limits. That is why there is no single answer to ""what DTI do I need?""

How do you calculate your DTI for a mortgage?

The math has three steps:

1. Add up your monthly debt payments, including the new house payment you are applying for.

2. Divide by your gross monthly income.

3. Multiply by 100 to get a percentage.

The CFPB's own example: $1,500 for a mortgage, $100 for a car loan and $400 for other debts adds up to $2,000 a month. With $6,000 of gross monthly income, the DTI is 33 percent.

For conventional loans, Fannie Mae's Selling Guide, section B3-6-02 (dated April 2, 2025; checked Sept. 27, 2026) counts the full housing payment on the new home. Fannie Mae calls this PITIA: principal, interest, taxes, insurance and association dues. It also counts installment debts that run more than ten months, lease payments, and alimony or child support that runs more than ten months, among other debts.

EXAMPLE ONLY: made-up household with $8,000 gross monthly income. Not real loan terms.

In this example, the housing payment alone is 30 percent of income ($2,400 ÷ $8,000). That smaller number is often called the front-end or housing ratio. The 40 percent figure is the total, or back-end, DTI.

What DTI do you need for a conventional loan?

Fannie Mae's Selling Guide (section B3-6-02, checked Sept. 27, 2026) sets these maximums:

• Manually underwritten loans: 36 percent of stable monthly income.

• Manually underwritten, with extra strength: up to 45 percent if you meet the credit score and reserve requirements in Fannie Mae's Eligibility Matrix. Reserves are cash and other easy-to-access assets you still have after the mortgage closes, per Fannie Mae section B3-4.1-01.

• Loans underwritten through Desktop Underwriter (DU): up to 50 percent.

The same section says lenders may use a more conservative approach than Fannie Mae requires. So your lender's limit can be lower.

What DTI do you need for an FHA loan?

For FHA loans that are manually underwritten, HUD Handbook 4000.1 (last revised Aug. 12, 2026; checked Sept. 27, 2026) sets two ratios: the housing payment to income, and total debts to income. The standard limit is 31/43. With a credit score of 580 or higher, higher ratios are allowed with compensating factors:

• 37/47 with one factor, such as verified cash reserves, a minimal increase in housing payment, or residual income.

• 40/40 with no discretionary debt.

• 40/50 with two factors from HUD's list.

Borrowers with scores from 500 to 579, or with no credit score, may not go above 31/43, except that Energy Efficient Homes may have stretch ratios of 33/45.

How big a house payment fits each DTI limit?

Here is the same example household, turned around. This shows the largest total housing payment that fits under each limit, after the $800 of other monthly debts.

EXAMPLE ONLY: $8,000 gross monthly income, $800 of other monthly debts. Your lender's numbers may differ.

For FHA's 31/43 standard, the housing ratio also has to fit. In this example, 31 percent of $8,000 is $2,480, so that is the FHA ceiling for the housing payment even though 43 percent would allow $2,640.

Is 43 percent still the DTI limit?

Not in the general federal Qualified Mortgage rule. You still see 43 percent everywhere, so here is the precise history.

The Regulation Z commentary on 12 CFR 1026.43 (checked Sept. 27, 2026) says that before the 2021 General QM Amendments, the general Qualified Mortgage definition required total monthly debt to be no more than 43 percent of total monthly income. Those amendments took effect March 1, 2021. They removed the 43 percent requirement and replaced it with limits based on the loan's annual percentage rate. For applications received from March 1, 2021 until Oct. 1, 2022, lenders could use either version.

Today, the CFPB's Qualified Mortgage page (checked Sept. 27, 2026) says the lender must consider either your DTI or your residual income, which is what you have left after paying your monthly debts. The official commentary adds that the rule does not set a particular DTI threshold. The 43 percent figure lives on in some program rules, like FHA's 31/43 standard for manual underwriting.

How can you lower your DTI before you apply?

There are only two levers: lower your monthly debts or raise your qualifying income.

• Pay down or pay off a debt. In the example, paying off the $450 car loan drops the DTI from 40 percent to about 34 percent ($2,750 ÷ $8,000).

• Avoid new monthly payments. Every new payment counts against you.

• Look at a lower price or bigger down payment. A smaller loan means a smaller housing payment.

• Ask about income you are not counting. Your lender will tell you what income can be documented and used.

What this means for new-construction buyers

New construction has a few DTI traps and one possible bonus.

• Your DTI can be checked again before closing. Fannie Mae's B3-6-02 says if new debts or lower income come up after approval, the loan must be re-underwritten when the DTI rises past set tolerances. If the new DTI tops 45 percent on a manual loan or 50 percent through DU, the loan is not eligible for Fannie Mae. On a long build, do not finance furniture or a car until after closing.

• Builder buydowns do not stretch your DTI. Fannie Mae's Selling Guide, section B2-1.4-04 (checked Sept. 27, 2026) says lenders must qualify you at the note rate, not the bought-down rate. Our 2-1 buydown guide explains why that matters.

• Energy-efficient new homes can help on FHA. HUD Handbook 4000.1 allows stretch ratios of 33/45 on manually underwritten FHA loans for Energy Efficient Homes. For new construction, the home must meet or exceed the higher of the latest energy code HUD has adopted or the energy code year used by the state or local building code. Ask your lender if the home qualifies.

Builder offers change often, so call 561-704-0091 for today's numbers.

National House Search is builder-neutral. We can help you compare homes from different builders against the payment your DTI actually allows.

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Related reading: 2-1 buydown explained · Buying a new-construction townhome for the first time · Condo vs. townhouse vs. single-family home

This is general information, not financial, tax or legal advice. Figures checked September 27, 2026."