What is a debt to income ratio calculator for a mortgage? It is a way of figuring out how much money you have available to invest in a major purchase. Whether you are an individual or a business buying a house, rental property or warehouse a debt to income ration calculator for a mortgage is something you will need. How does a debt to income ratio calculator for a mortgage work? It is a process where the broker at the financial institution will for all the documentation showing how much you owe on credit cards, loans, creditors and any other forms of debt. They will then ask for evidence of all of your income for a period of time, usually a year, and compare the the two figures. Normally, when the amount that you owe is compared to the amount that you bring in, they want to see that no more than 33% of your income is taken up by debt. Is there somewhere that I can go to calculate this on my own? There are several websites that provide you with a debt to income ratio calculator for a mortgage. Just a few of these sites are: Bankrate provides you with a simple calculator where you can enter in your debt and income and it will give the ratio level. Consumercredit has a detailed excel spreadsheet and an acrobat reader worksheet that you can download and use to calculate your ratio. Mortgage-info provides you with a more detailed calculator and instructions on how to use it. Consolidatedcredit is another site that has a detailed calculator that you can use for figuring out your debt to income ratio for a mortgage. Why is this so important? A debt to income ratio calculator for a mortgage is important to have run so that won't be in danger of over extending yourself to the point of bankruptcy. It is also important so that you know if you can invest in more of your income and buy a bigger house or that extra investment property that you have been looking at to purchasing. Is a debt to income ratio calculator for a mortgage the only factor on figure out if I am a good risk to make a big purchase? Your credit card score and payment history is just as important since it shows how well you are at managing your debt. A financial institution usually wants to see a score of between 700 and 850. One thing that you should be aware of when your credit card score is being checked is that just by looking at your score too often can result in a lower score. How often should I use a debt to income ratio calculator? A debt to income ratio calculator for a mortgage is a good gauge on whether you qualify for that major investment but is something that you should get in the habit of using on a periodical basis to stay on your household budget. No one wants to run into unexpected expense that could drive you into debt to the point where you can't get back into the black. This article explains just what a debt to income ratio for a mortgage is and why it is important to check it whenever you are about to make a large purchase. Even if that purchase doesn't lead to a mortgage it is still a good idea to get in the habit of keeping track of where you fall in that ratio.