Pay off the $7,200 loan, not the $61,000 one.
DTI is the number one reason mortgages get denied, and almost nobody checks it before applying. It also has a counterintuitive fix: the debt you should kill is rarely the biggest one. It's the one with the worst payment-to-balance ratio.
Debt-to-income is the ratio that decides whether you are approved, and it is the leading reason mortgage applications are declined. There are two: front-end (housing payment ÷ gross income, guideline about 28%) and back-end (all debt payments including the mortgage ÷ gross income, common conventional ceiling 43%). The counterintuitive part: to lower your back-end ratio you should clear whichever debt has the highest monthly payment relative to its balance — which is usually a small personal loan or card, not the large student loan. Clearing a $7,200 personal loan with a $340 payment can get you approved, while clearing a $61,000 student loan on income-driven repayment — eight times the money — leaves you still declined.
Are you over the line?
Enter what you owe. We'll show both ratios, where the ceiling sits, and exactly how far you are from it.
Gross, not take-home. Before tax. Lenders use the pre-tax number.
Over the 43% ceiling by 2.0 points. You would likely be declined.
Your back-end DTI is 45.0%. The ceiling is 43%. You need to shed $280/mo of payments — and we will tell you exactly which account to attack.
Your ratio, against the wall.
The slabs are your monthly obligations, stacked. The line is the 43% ceiling. Everything above it is why the answer is no. Tap any slab to see what removing it would do.
Adriana will pull your actual obligations and build the shortest path under 43%. Most people are closer than they think.
Illustrative only. 43% is a common conventional back-end ceiling; it is not universal. FHA frequently allows higher with compensating factors, VA uses residual income rather than a hard DTI cap, and automated underwriting systems approve above 43% every day where reserves, credit and loan-to-value are strong. Student loan payments are counted differently across programmes, particularly under income-driven repayment. Treat this as a map, not a verdict. Not a commitment to lend. Equal Housing Opportunity.
Kill this debt. Not the big one.
Every instinct says attack the largest balance. For mortgage approval that is almost always wrong. What matters is the monthly payment you remove per dollar you spend — and by that measure the small, ugly loans win every time.
This ranking is the opposite of the "avalanche" and "snowball" methods — both of which optimise for interest or momentum. Neither optimises for getting approved.
It costs $7,200 and takes your DTI from 45.0% to 42.6% — under the ceiling, approved.
Compare that to the instinct. Student loan is the bigger balance at $61,000, and clearing it only gets you to 43.9%. Lenders count the payment, not the balance — so the small, ugly loan with the brutal payment is worth far more to your approval than the large one with a gentle one. Everyone attacks the big number. It is almost always the wrong move.
From here to the keys — five steps.
No mystery, no call centre, no "we'll get back to you." Every step is exactly what happens inside it.
Four questions. No credit pull, no sign-up, no obligation.
~60 secondsWhat happensShe will tell you which single account to clear — often for a few thousand dollars — to get you under the ceiling.
Same dayWhat happensUnderwritten against real documents — not a soft letter any lender prints.
~24 hoursWhat happensListing agents call Adriana. She picks up. That is worth more than a bid.
Your timelineWhat happensConditions cleared, docs signed, funded. And she tells you when PMI ends.
To the dateWhat happensThree borrowers. One paid off the wrong debt.
Real numbers, real verdicts.
It removed $410 of payments for $61,000 of cash. The personal loan would have removed $340 for $7,200.
A $7,200 personal loan carrying a $340 payment. It was the whole problem.
$680/mo of new debt, signed during underwriting. We caught it. The loan survived.
ADReal Estate & Mortgage Broker · GRI
Milpitas, California · Serving all 58 counties
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"A broker who will tell you no is the only kind whose yes means anything."
The other eight calculators.
Each one shows you a number the rest leave out.
Everything people actually ask.
What is a good debt-to-income ratio for a mortgage?
For a conventional loan, 43% back-end is the common ceiling and under 36% is comfortable. Front-end — housing alone — is traditionally guided at 28%. But these are conventions, not laws: automated underwriting approves above 43% every day when credit, reserves and loan-to-value are strong.
Which debt should I pay off to get approved?
The one with the highest monthly payment relative to its balance. Lenders count the payment, not the balance — so a $7,200 personal loan with a $340 payment hurts your DTI more than a $61,000 student loan with a $410 payment, and costs a fraction as much to remove. Nearly everyone gets this backwards.
Does paying down a credit card balance help my DTI?
Only if it lowers the minimum payment, and partial paydowns often barely move it. Paying a card to zero and keeping it open is usually the highest-leverage move — it removes the payment from your DTI while preserving the available credit that helps your score. Do not close the account.
What counts as debt in the DTI calculation?
Anything that appears as a recurring obligation: car loans and leases, credit card minimums, student loans, personal loans, child support, alimony, and HOA dues. What does not count: utilities, phone, insurance, groceries, and most subscriptions. The line is roughly 'does it show on a credit report or a court order.'
How are student loans counted if I'm on an income-driven plan?
This varies significantly by programme and it matters enormously. Some allow the actual documented IDR payment, even if it is very low. Others impute a percentage of the balance regardless of what you actually pay. The same borrower can qualify for wildly different loan amounts depending on which programme is used — which is a real reason to work with a broker rather than a single lender.
Can I get approved with a DTI over 43%?
Often, yes. FHA regularly approves higher with compensating factors. VA does not use a hard DTI cap at all — it uses residual income. Automated underwriting on conventional loans will approve above 43% when reserves and credit are strong. 43% is where it gets difficult, not where it becomes impossible.
Will opening a new credit account hurt my approval?
Badly, and at the worst possible moment. Lenders re-pull credit shortly before closing. A car loan, a furniture plan, or a new card signed during underwriting can add hundreds of dollars of monthly payments, push you over the ceiling, and kill a loan that was already approved. Buy nothing on credit until you have the keys.
Does my spouse's debt count if they're not on the loan?
In most states, no — only the borrowers on the application are counted. California is a community property state, and for certain government loan programmes a non-borrowing spouse's debts may still be counted even though their income is not. It is a genuinely unfair asymmetry and it catches people out. Ask before you assume.
Stop estimating. Get the real number.
Four questions, no credit pull. You'll get your payment, your options, and an honest read on the best fit.