Debt-to-income ratio is your monthly debt obligations compared to your gross monthly income, expressed as percentage. It is generally agreed that a good debt-to-income ration is less than or equal to 36%, whereas a debt-to income ration above 43% is considered to be too much debt. Focus on reducing your existing debt as much as possible before purchasing a home, as your debt-to-income ration has an impact on how much you can borrow.
