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How Important Is The Debt-To-Income Ratio To Canadians?

Due to the effects of the COVID-19 Pandemic, the debt-to-income ratio in Canadian households has been on the rise since 2020.

As individuals, the debt-to-income ratio is as important as your credit score as it tells you how affordable your debt repayment is. This ratio will tell you if you are comfortable in repaying your debt or you have too much debt to pay.

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Helped with $ 27,000 $ 41,500 $ 35,000 $ 17,000 $ 23,500 $ 46,340 $ 21,000 $ 35,000 $ 26,700 $ 65,500 $ 57,400 $ 17,500 $ 75,500 $ 63,000 $ 35,000 $ 18,500 $ 55,000 $ 85,500 $ 43,000 $ 29,500 $ 27,800 $ 41,200 $ 35,800 $ 85,000 in debt

1 day 3 days 3 days 8 days 7 days 6 days 12 days 9 days 3 days 6 days 1 day 4 days 2 days 1 day 7 days 5 days 8 days 6 days 12 days 16 days 5 days 8 days 2 days 7 days ago in debt in

Orillia Huntsville Peterborough Toronto Brampton Kitchener Mississauga Hamilton Belleville Kingston Cornwall Oshawa Ajax St. Catharines London Sarnia Windsor Sault Ste. Marie Elliot Lake Sudbury North Bay Timmins Thunder Bay Ottawa

In this blog, you will learn how to calculate and find out if you have too much debt to handle.

Debt-To-Income Ratio

Calculate Your Debt-to-Income Ratio

Calculate Your Debt-to-Income Ratio

To calculate your debt-to-income ratio, sum up all your monthly debt obligations and divide the total by your monthly gross income/salary. Now, to convert the value to percentage, multiply the figure by 100.

Take note to include all your income sources such as your spouse’s salary, Child Tax Benefit, pension, and other sources of funds. For total monthly debt payments, total your minimum monthly payments on credit cards, car payments, loans, bills, and other monthly obligations.


DTI = Total Monthly Debt Payments ÷ monthly gross income x 100


  • Monthly Gross Salary: $4,500.00
  • Total Monthly Debt Payments: $2,200.00

DTI = $2,200.00 ÷ $4,500.00 x 100

DTI = 49%

What is the Acceptable Debt-To-Income Ratio?

Acceptable Debt-To-Income Ratio

Many Canadians carry a lot of debt, especially from credit cards or lines of credit that only require you to pay minimum payments every month. You must know that minimum payments won’t help you pay off your debt. This is a way for banks to keep you as a customer and keep you in debt.

Below are examples and what your DTI is telling you.

30% or Less

This is a good ratio. It means you are in good financial shape, and you can save money because your debt is a lot less compared to average individuals. Keep track of your budget to maintain this ratio.

31% to 41%

This is the maximum range of acceptable ratio. Meaning you are at the edge of falling into a debt trap. Start working on your debt now before your debt interests get uncontrollable. If you are only making minimum payments each month, start paying more next month. This will help you pay off your credit card debt faster and improve your DTI Ratio fast.

42% to 50%

You need to be concerned about your finances at this stage. Any slight changes in your income can put you in a danger zone. You may not have the capacity to make payments more than the minimum because of the percentage of the debt you are paying versus your gross income.

Above 50%

This is a dangerous range to be in. This means your debt repayment is taking up more than 50% of your monthly income. It indicates that you are experiencing a debt problem. This is not the time to procrastinate and wait for it to get even worse. Talk to our debt specialists by clicking the below button to learn more about your debt relief options immediately.

4 Importance of Knowing Your DTI Ratio

Knowing Your DTI Ratio

1. New Line of Credit Approvals

Aside from looking at your credit rating, lenders will look into your debt-to-income ratio to assess the risks of lending you money. Credit scores are used to review your borrowing profile and payment history while the debt-to-income ratio helps banks to gauge your capacity to afford a higher monthly payment when taking a new loan or credit line.

2. Mortgage Assessment

If you are applying for a housing loan, a mortgage lender will look into your debt-to-income ratio. Most lenders recommend that your DTI ratio don’t exceed 35%.

3. Risk of Being Insolvent

It is normal for people to experience unexpected life events such as getting laid off from work, medical expenses, divorce, or loss in the family. Experiencing these life events that happen unexpectedly could potentially stretch out your finances and eventually affect your debt payments. Unexpected life events when combined with high debt-to-income levels are the most common causes of getting insolvent.

4. Help you Prioritize Debt Repayments

A lower ratio means you’ll have more income going towards your savings. This will help you build an emergency fund that you can use if needed.


High “Debt-To-Income Ratio”, What You Can Do

lower debt-to-income ratio

If you feel you are running out of options and you are stuck in debt, you are not alone. We can help lower your debt-to-income ratio through our government-approved debt relief programs.

Our debt relief programs are an amazing way of helping Canadians eliminate up to 75% of unsecured debts in just 5-7 days. You are eligible to take advantage of this debt relief program if you owe more than $10,000 debt and consolidate Credit Card Debt, Personal Loans, Car Loans, Taxes, CERB, HST, 407, Household Bills, Payday Loans, and Student Loan.

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Awesome service. Alan knows what he's talking about and he truly cares about his clients. I highly recommend this company if you need help with money problems.
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A1 top notch service! Alan was awesome and always available when I had questions. He's very knowledgeable and takes pride in his work and his clients and is great at putting people at ease. I would recommend this service to anyone needing help with finances.
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i just wanted to say i had a great experience with suma who helped me out tremendously.. she explained everything and helped me as much as she could on her end ..all and all it was easy and now that im finished so much stress has been lifted ...thanks so muchto all that were involved i the process

Top 5 Key Benefits of our Ontario Debt Relief Program:

To know more what you can benefit from our Ontario Debt Relief Program, simply try our Debt Consolidation Calculator below and one of our debt specialists will get in touch with you and provide you the best debt relief option that fits your situation.

Do you want to experience Peace of Mind from all of these?

  • Credit Card Debts
  • Personal Loans
  • Car Loans
  • Taxes
  • HST
  • 407
  • Household Bills
  • Payday Loans
  • Student Loan
  • and more…

Talk to us! We will help you get out of debt.

We will help you reduce as much as 75% of your debts and consolidate it into a single affordable monthly payment. Your creditors will stop harassing you and all interest will freeze if you get into our Ontario Government Debt Relief Program.

Many Ontarians are already benefiting from our Debt Relief Program, YOU should too!

Find out how much you can write off portion of your debts by getting your Free Savings Estimate below. A debt specialist from National Debt Relief Services in Ontario will discuss all options and provide you tailor-fitted Debt Relief Program.

We will help you compare
the options and savings of all formal debt relief programs available to you.


No contact details required to find out if you qualify

Frequently Asked Questions

A Debt Consolidation is a negotiated debt settlement offer made between you and your creditors with the help of a Debt Relief Agency in Ontario. Some key benefits of Debt Consolidation are interest-free program, no upfront fee required, combined monthly payment into one affordable amount, no lawsuits, and many more.

Yes, your assets are safe from creditors. A licensed debt relief agency in Ontario will help you come up with an offer to your creditors that will make sure your assets will be out of the paper.

No, in fact, this is one of the great advantages of a Debt Consolidation Program. All wage garnishment will stop from the day you filed the proposal.

The effect on your credit score is not going to be severe. Your credit score will most probably go to R7 Rating and will remain in your credit report for another 3 years after you completed the program. This means that it will not be permanent and you will still be able to rebuild your credit score.


This varies depending on the proposal you will be discussing with the help of a certified debt relief agency. It is also worth noting that debt consolidation cannot exceed more than 5 years.

If a debt is shared, you need to file a joint debt consolidation offer to your creditors. However, in most cases, in which the debts are individually incurred will have no impact on your spouse.

After three missed payments, your debt arrangement with creditors will be broken and you will end up getting chased again for the original debt amount plus interest.

A debt consolidation offer can be paid off earlier if you can. In this way, you receive your “Certificate of Completion” sooner and you can immediately start rebuilding your credit score. 

National Debt Relief Services Ontariois a certified Canadian Debt Relief Agency that offers FREE CONSULTATION to your debt consolidation needs. We value the trust given to us by our clients by making sure your personal information is confidential and private. Our personalized plans are designed to tailor fit your financial capacity. Our specialists will get in touch with you by simply answering a few questions thru the link provided below.

Why Trust National Debt Relief Services?

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I've been working with Allicia Macdonald shes very professional and sweet. I cant thank her enough for helping me rebuild my life. Thank you so much.
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Today I had a wonderful experience with Rachael, she was Very professional I was very happy with what we talked about today she was very Caring I highly recommend national debt relief services hundred percent😃
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marian kamara
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I have a great experience working with Suma, she work me through the program, takes her time to explain everything to me about how the program work, what I need to do from start to end of the process. I’m so thankful to God for sending an angel Suma to help relief my debt. It’s a great company to work with. I will recommend this program for anyone in debt like me.
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Connie B. was absolutely awesome! She explained everything in detail to me. Very professional to work with and takes the time with you. She really has compassion. So glad she helped me out. Thank you
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Joel has made this so simple and effortless he made sure i was well informed and making the right decisions for my situation i would recommend joel at national dept Relief to anyone in hardship with there bills thanks alot joel i really appreciate everything you have done for me thanks!! 5 stars for sure! and its chad ball not my mom lynn lol
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I had a great experience with Brittany, so helpful and understanding. Never felt like I was being pressured or rushed into anything. She was always there with answers to my questions. Thanks for all the help and peace of mind you helped me achieve.
Amber-lyn Miller
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Let’s Just Put It Simple....... Not All Hero's Wear Caps........I spoke with Suma over a fairly lengthy period of time because of my busy schedule and lack of free time on my part, and she was not only extremely patient and understanding, but also beyond helpful And informative. Any question I had and no matter how many times she had to explain it to me she took her time to make sure I completely understood every single step and process before she moved on to the next thing. I have been so stressed out and worked up about my debt and trying to figure out how to fix it all since I know I will not be returning to work at all in the future because of medical issues and being 26 with that realization makes things just that more stressful but Suma made everything so easy and my payments are $100 a month for less then 5 years with no interest or penalties for early pay off. I’m so glad that I didn’t settle with some other place that was asking for $350 + a month for 7-12 years and paying off early would cost you more.
Jessica Preston
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Caroline F. was phenomenal, she was so helpful, understanding and compassionate. Caroline did not make me feel bad for my mistakes, she was supportive and caring, she helped me through this dark time in my life I'm so incredibly happy I crossed paths with her. Thank you Caroline for being so wonderful to me! <3

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