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MasterMath

Debt-to-Income Calculator

On 2,500 a month with no existing debt and a 35% limit, you can take on 875 in payments and keep 1,625 to live on. Add existing debts and watch the headroom close.

Currency and number format for

Payment you can take on

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Payment you can take on—
Total debt ceiling—
Already going on debt—
Headroom left—
Left to live on—

How this was worked out

    The formula

    ceiling = income × limit ÷ 100 · available = ceiling − existing payments

    Where it comes from

    Lenders cap total debt payments at a percentage of income. Everything you already pay counts against that ceiling, so what you can borrow next is whatever is left underneath it.

    How to work it out by hand

    1. Take your monthly take-home pay
    2. Multiply by the limit percentage to get the ceiling
    3. Subtract every debt payment you already make
    4. What remains is the payment a lender would allow

    What is worth knowing

    The limit is a convention, not a law, and it varies. Much of Europe uses a single ratio around 35%. US lenders more often use two: roughly 28% for housing alone and 36% for all debt combined, and both have to pass. Some programmes stretch to 43% or beyond with compensating factors. Whichever number applies, treat it as a ceiling and not a target — it is the point at which a lender stops being comfortable, which is well past the point where your budget stops being comfortable. The figure to watch is what is left to live on, and whether it survives a rate rise.

    Frequently asked questions

    What debt-to-income ratio do lenders want?

    Commonly up to 35% in Europe and 36% for total debt in the US, with housing alone capped nearer 28%. Some programmes allow more with strong credit or large reserves.

    Gross or net income?

    US lenders typically use gross income; European lenders more often use net. This calculator uses whatever you enter, so be consistent with your lender's convention.

    What counts as debt?

    Mortgage or rent, car finance, personal loans, student loans and card minimums. Utilities, insurance and groceries usually do not.

    Should I borrow up to the limit?

    No. The limit is where the lender stops being comfortable, not where you should. Check what is left to live on and whether it survives a rate rise.