Quick answer: Front-end DTI compares housing cost to gross monthly income and is one affordability signal.
What this means
Front-end DTI focuses on housing cost relative to gross income.
It is useful, but it should be paired with net-income cash flow and non-housing bills.
Key takeaways
- Use the all-in monthly cost, not only principal and interest.
- Check leftover cash after debts and living expenses.
- Verify lender, tax, insurance, and HOA numbers before purchase.
Formula or planning rule
True monthly cost = P&I + taxes + insurance + PMI + HOA + utilities + maintenance reserve
Common mistakes
- Ignoring utility increases after moving.
- Using lender approval as the same thing as comfort.
- Spending cash-to-close without preserving reserves.
- Forgetting HOA, PMI, or reassessment risk.
How to use this site
Run the calculator with your expected purchase price, down payment, rate, taxes, insurance, utilities, maintenance reserve, debts, and living expenses. Save the scenario link and compare multiple purchase prices before making an offer.
FAQ
Is front-end dti included in the calculator?
Yes. The calculator is designed to include front-end dti as part of a more realistic mortgage affordability estimate.
Does this replace a lender estimate?
No. It is an educational planning tool. Confirm loan, tax, insurance, and legal details with qualified professionals.
Why use leftover cash?
Leftover cash helps show whether the payment is workable after the mortgage, ownership costs, debts, and normal monthly expenses.