Debt-to-Income Ratio (DTI)
Your DTI is a simple percentage that shows what portion of your gross monthly income goes toward debt payments. Lenders use this to determine how much you can afford to borrow.
Example
Your gross monthly income: $5,000
Your total monthly debt payments: $1,000 (car payment $400 + student loans $300 + credit card minimum $300)
DTI = ($1,000 ÷ $5,000) × 100 = 20%
What Lenders Want
Excellent
Below 20%
Strong approval odds, better rates
Good
20–28%
Typical approval range
Caution
29–43%
May need stronger profile
Higher DTI
43%+
Specialized programs and strategies available
How to Improve Your DTI
- Pay down debt: Focus on high-interest credit cards first. Each payment reduces your monthly obligations.
- Increase income: A raise, bonus, or side income strengthens your application.
- Don't take on new debt: Avoid car loans, personal loans, or opening new credit cards before applying.
- Pay off small debts: Eliminating one payment completely helps more than paying down one large debt.
Credit Score
Your credit score is a three-digit number (300–850) that represents your creditworthiness. It's based on your credit history and tells lenders how likely you are to repay borrowed money.
What Goes Into Your Credit Score?
35%
Payment History
Do you pay bills on time? Late payments hurt.
30%
Credit Utilization
How much credit are you using? Keep it below 30%.
15%
Credit History Length
How long have you had credit accounts open?
10%
Credit Mix
Do you have varied credit types (cards, loans)?
10%
New Credit
Recently opened accounts can lower your score temporarily.
Credit Score Ranges
Excellent
750+
Best rates, easiest approval
Good
670–749
Competitive rates, solid approval
Fair
580–669
Path forward available, we'll build your strategy
Starting Point
Below 580
FHA programs available, credit specialist support
How to Improve Your Credit Score
- Pay all bills on time: Payment history is 35% of your score. Set up autopay to ensure you never miss a deadline.
- Lower credit card balances: Use only 10–20% of your available credit. If you have a $5,000 limit, keep your balance below $1,000.
- Don't close old accounts: Keep older credit accounts open to maintain a longer credit history.
- Check your credit report: Visit annualcreditreport.com (free) and dispute any errors.
- Avoid new credit inquiries: Hard inquiries (applying for new credit) can temporarily lower your score. Only apply when necessary.
- Get expert guidance: If you need support improving your credit, we'll connect you with a credit specialist who can create a personalized plan.
Your Action Plan
Not sure where you stand? Let's figure it out together.
1
Know Your Numbers
Calculate your DTI. Check your credit score (free at creditkarma.com or annualcreditreport.com).
2
Get Pre-Qualified
See what lenders think. This won't hurt your credit and shows you what's realistic.
3
Make a Plan
If your numbers need improvement, we'll create a realistic timeline and strategy.
4
Get Approved
Once you're ready, move forward with confidence.