Buyer's Glossary
Debt-to-Income (DTI)
The number lenders use to decide if a loan is a stretch, and how much you can borrow.
What it is
DTI weighs everything you owe against everything you earn. Add up all your debt, which means the home loan you are applying for plus HECS, a car loan and your credit-card limits, then divide it by your gross annual income.
The answer is shown as a multiple of income. A $500,000 loan on a $110,000 income is roughly 4.5 times.
APRA counts six times income or more as high DTI lending.
Why it matters
Low DTI
- Your loan is small next to your income
- Repayments leave breathing room if rates rise
- The result = more lenders compete for you
High DTI
- Your loan is large next to your income
- A thin buffer if rates or costs rise
- The result = fewer lenders, more questions
What counts as high, what counts as low
Shaded from a buyer's point of view: teal is favourable if you are buying, amber is balanced, red is harder. That is why this looks inverted against some other metrics, because a fast-moving market is good for a seller and hard for a buyer.
DTI is your total debt divided by gross annual income. APRA counts 6 times or more as high DTI. Source: APRA, February 2026.
The trend to watch for
It counts your total debt, not just the home loan. HECS, a car loan or your credit-card limits all count, so clearing them before you apply can lift what you can borrow.
The lower your DTI, the more lenders will compete for your loan, and often the sharper the rate. Coming in under six times income keeps the widest choice on the table.
What it looks like in the real world
Low DTI
under 5×
- A $500k loan on $110k income is 4.5×
- Approval is usually straightforward
- Room to handle a rate rise
High DTI
over 6×
- An $800k loan on $120k income is 6.7×
- Fewer lenders will approve it
- May need a bigger deposit or less other debt