Mortgage programs›Jumbo loans›Jumbo loan DTI requirements

Jumbo Loan DTI — California

What DTI ratio do you need for a jumbo loan?

Debt-to-income ratio is one of the key qualifying factors on a jumbo loan. Here’s how it’s calculated and what the limits are.

Get a free rate quote

What is DTI?

Debt-to-income ratio (DTI) is the percentage of your gross monthly income that goes toward monthly debt obligations. DTI = Total monthly debt payments ÷ Gross monthly income.

DTI limits on jumbo loans

Scenario Maximum DTI
Primary residence, LTV ≤ 80%, loan ≤ $2M Up to 50%
Higher loan amounts or LTV > 80% 45%
LTV > 80% on select programs 38–40%
Second home 40–50% depending on program
Investment property 38–50% depending on program

How specific debts are treated

  • Student loans: Must be included unless fewer than 10 months remain; 1% of balance used if no payment documented
  • Installment loans: Debts with more than 10 months remaining must be counted
  • Revolving debt: Minimum payments on all open accounts must be included; paying off revolving debt to qualify is generally not permitted
  • Child support/alimony: Payments with more than 10 months remaining must be included

How to improve your DTI

  • Pay off installment loans before applying
  • Document all eligible income sources
  • Avoid taking on new debt before applying
  • Consider adding a co-borrower if their income strengthens the application

Most jumbo borrowers qualify in the 38–50% DTI range. If your DTI is above 45%, structuring the application correctly becomes especially important.

Serving California homebuyers and investors — Orange County, Los Angeles, San Diego, the Inland Empire, and communities throughout Southern California including Irvine, Huntington Beach, Anaheim, Fullerton, Garden Grove, and Santa Ana.

A worked example: calculating your DTI

This is an illustrative example, not a quote. Suppose your gross income is $22,000 per month. Your debts are a $9,000 proposed housing payment (PITIA), a $700 car payment and a $300 student loan payment, which is $10,000 in total.

$10,000 ÷ $22,000 = 45.5%. Based on the table above, that falls under the 50% limit for a primary residence at 80% LTV and a loan up to $2M, but it is above the 45% limit for higher loan amounts or LTV over 80%. Same borrower, different answer depending on the structure.

What counts as income

  • Base salary, hourly pay and documented overtime, bonus or commission with a stable two-year history.
  • For self-employed borrowers, the net income shown on tax returns after write-offs, averaged over 24 months.
  • Rental income, when documented, can offset the related housing payment. Rules differ for the subject property and for other rentals.

Ways to improve your ratio before you apply

  1. Recalculate with the actual proposed payment, including property taxes (roughly 1% of assessed value plus local assessments) and homeowners insurance, not just principal and interest.
  2. Look at installment loans by monthly payment, not balance. Paying off a car loan that has a $600 payment and more than 10 months left lowers your ratio more than a loan with a small payment, though paying off revolving debt just to qualify is generally not permitted.
  3. Compare loan structures. A larger down payment, or a longer fixed term, reduces the payment and therefore the ratio.
  4. Time any large purchases for after closing.

Frequently asked questions

Do utilities and groceries count in DTI?

No. DTI only counts debt obligations that appear on your credit report or that you document, such as loans, minimum card payments, support and the new housing payment. Everyday expenses are not part of the formula.

Does a co-borrower always help?

Only if their income adds more than their debts take away. A co-borrower with high income and heavy debt payments can leave the ratio unchanged or worse, and their credit profile will be reviewed too.

Is DTI the only affordability test?

No. Underwriters also review reserves and credit. A borrower with a high ratio and large reserves is evaluated differently from one with a high ratio and thin savings.

Related guides