How to use
- Enter the housing payment you want counted. Include only the pieces you intend, such as principal, interest, tax, and insurance, if those are part of the payment you typed.
- Enter other monthly debts: car, student, card minimums, and anything else you are counting. Add them before you type.
- Enter gross monthly income, before tax.
- Press Calculate. The hero is the back-end percent.
How it's calculated
Housing ratio = housing ÷ gross income × 100. Back-end ratio = (housing + other debts) ÷ gross income × 100.
The page does not decide which debts a lender counts. If a lender ignores a payment or adds one, change the dollars you typed.
Worked example
Housing of $1,800 plus other debts of $400 is $2,200. Divided by $6,000 of gross monthly income, the back-end ratio is about 36.67 percent. Housing alone is 30 percent.
Assumptions
Monthly figures, gross income, and the debts you chose to include. A lender's underwriting guide is a separate document. This result is not an approval.
FAQ
Is there a maximum percent that always passes?
No number on this page is a pass line. Lenders set their own ceilings, and those ceilings change.
Should income be before or after tax?
Gross, before tax, because that is the denominator this ratio uses.
What goes in other debt?
The monthly obligations you want in the ratio. Add the minimums yourself. The page has one box for that sum.
Does this include the new loan I might take?
Only if you type that future payment into housing or other debt. The form does not invent a payment.