Mortgage Loan DTI Limits Comparison
Different loan programs apply different debt-to-income benchmarks:
| Loan Type | Front-End (Housing) | Back-End (Total Debt) | Max with Compensating Factors |
|---|---|---|---|
| Conventional (Fannie/Freddie) | 28% | 36% | Up to 45% (or 50% with Desktop Underwriter) |
| FHA Loan | 31% | 43% | Up to 45%–50% with AUS approval |
| VA Loan | None (no cap) | 41% benchmark | Up to 50%+ if residual income test passes |
| USDA Loan | 29% | 41% | Up to 44% with credit scores 680+ |
What lenders read into your debt-to-income ratio
Debt-to-income compares your monthly debt payments with your gross monthly income. It is one of the first things a mortgage underwriter calculates, because it answers a question a credit score cannot: whether you can actually service another loan on top of what you already owe. Two applicants with identical scores and very different DTIs are very different risks.
Lenders usually look at two versions. Front-end DTI counts only housing — the proposed mortgage payment plus tax and insurance — and conventional guidance keeps it around 28%.Back-end DTI adds every other recurring obligation: car loans, student loans, credit card minimums, child support. Conventional lending commonly wants this at or below 36%, though many programmes stretch to 43% and some government-backed loans further still with compensating factors.