Is a DTI of 6 always the maximum allowed?

Not always. A DTI of 6 is a common owner-occupier benchmark, but lenders can apply their own credit policy and some lending may sit outside the standard restriction settings.

Do credit card limits affect debt-to-income calculations?

Yes. Credit card limits can reduce borrowing power because lenders often treat available revolving credit as part of your wider debt position.

How can I improve my DTI before applying for a mortgage?

Reducing unsecured debt, lowering unused credit limits, and adjusting the intended purchase budget are common ways to improve your DTI position before applying.

Debt-to-Income (DTI) Calculator

Calculate your debt-to-income ratio and understand how it affects borrowing

The Reserve Bank uses DTI ratios as a lending restriction tool. Most owner-occupiers are limited to a DTI of 6, meaning total debt cannot exceed 6x your gross annual income.

Gross Annual Income

Your Income

Partner Income

Debts

Proposed New Mortgage

Existing Mortgage(s)

Car Loan

Student Loan

Credit Card Limit

Other Debt

Your DTI Ratio

3.9x

Low Risk

Total Income

$160,000

Total Debt

$630,000

Existing Debts Reducing Your Capacity

$30,000

Car loans, student loans, credit card limits, and other debts all count against your DTI limit

Available Mortgage Capacity

After subtracting your existing debts of $30,000

At 5x DTI (Conservative)$770,000

At 6x DTI (Standard Limit)$930,000

At 7x DTI (Investors)$1,090,000

Maximum Total Debt Capacity (before existing debts)

At 5x DTI$800,000

At 6x DTI$960,000

At 7x DTI$1,120,000

DTI Guidelines

≤5x: Comfortable borrowing level

5-6x: Standard limit for owner-occupiers

6-7x: May require exemption or investor status

>7x: Likely to be declined

What counts toward your DTI

Your debt-to-income ratio compares total debt against gross annual income. Banks can include the proposed mortgage, existing home loans, personal lending, credit card limits, and other committed debt when assessing the ratio.

Credit card limits can matter even if the balance is low.
Car finance and personal lending reduce your borrowing headroom.
Existing mortgages still count when you are buying again or refinancing.

How to improve your borrowing position

If your DTI is tight, the fastest improvements usually come from reducing unsecured debt, lowering credit limits, or adjusting the purchase budget before you apply.

Pay down short-term debt before applying.
Close unused credit cards or reduce limits where sensible.
Review the target price range if the proposed mortgage is pushing you above lender comfort levels.

Debt-to-income FAQs

Is a DTI of 6 always the hard limit?

Not always. It is a common benchmark for owner-occupiers, but lenders can still apply their own credit policy and some lending can fall under exemptions.

Do student loans and credit card limits affect DTI?

Yes, they can. Even if a student loan is interest-free in New Zealand, it still affects servicing and total debt position. Credit card limits can also reduce borrowing power.

What should I do if my DTI looks too high?

Focus on reducing smaller debts, trimming credit limits, or revising the purchase budget. A broker can also help assess whether another structure or lender appetite changes the outcome.

Disclaimer: This calculator provides estimates only and should not be relied upon for financial decisions. Actual loan terms, rates, and eligibility may vary. Please contact a Mortgage Lab adviser for personalised advice.