Debt-to-Income Calculator NZ

The RBNZ introduced debt-to-income (DTI) ratio limits on 1 July 2024. Your DTI determines how much a bank can lend you relative to your income — and understanding yours before you apply for a mortgage can save you a lot of time.

What is a debt-to-income ratio in NZ?

In New Zealand, your DTI ratio is a simple multiple: your total debt divided by your gross annual income. For example, if you have $500,000 in total debt and earn $100,000 per year, your DTI is 5×. This is different from the percentage-based DTI used in some other countries — in NZ it's always expressed as a multiple.

The RBNZ introduced formal DTI limits on 1 July 2024 as part of its macro-prudential toolkit. Before this, banks applied their own informal versions of DTI testing — the RBNZ formalised and standardised the approach across the sector.

What are the NZ DTI limits?

The RBNZ sets two thresholds: 6× for owner-occupiers and 7× for investors. These aren't hard caps — banks can still lend above these limits, but only for up to 20% of their new lending in each category. That means competition for high-DTI loans is real, and banks will apply stricter criteria for borrowers above the threshold.

Note that DTI is one test among several. Banks also apply their own affordability and stress-test calculations, which typically assume a higher interest rate than your actual rate. Passing the DTI test doesn't guarantee loan approval — but failing it makes approval significantly harder.

What counts as debt in the NZ DTI calculation?

The RBNZ framework includes the following in your total debt for DTI purposes:

All mortgage balances (fixed and floating)
Personal loans and hire purchase
Car loans
Student loan balances (even though NZ student loans are interest-free for NZ residents)
Business loans
Credit card limits — not the outstanding balance. If your limit is $10,000, that's what counts.
Overdraft limits

The following are not included: rent payments, buy now pay later (BNPL) debt.

How can I improve my DTI ratio?

There are three levers: reduce your existing debt, increase your income, or reduce the size of the proposed mortgage.

Pay down existing debt — especially credit cards. Because the limit counts (not the balance), closing or reducing the limit on unused credit cards can immediately improve your DTI without paying down a cent of actual debt.
Increase your income. Any documentable increase in gross income — a pay rise, rental income, or additional employment — directly improves your DTI ratio.
Reduce the proposed mortgage size. A larger deposit means a smaller loan, which reduces total debt and improves your DTI.

Frequently asked questions

What is a good debt-to-income ratio in NZ?

Under the RBNZ framework, a DTI of 6× or below is considered standard for owner-occupiers, and 7× or below for investors. Most banks will be comfortable lending at a DTI of 5× or below. A DTI under 4× is considered low risk and gives you strong borrowing capacity.

Do credit card limits count in NZ DTI calculations?

Yes — banks use your credit card limit, not your outstanding balance. This means unused credit cards still count toward your DTI. If you have credit cards you don't use, consider closing them before applying for a mortgage to improve your DTI ratio.

Does my student loan affect my DTI in NZ?

Yes — your student loan balance is included in the DTI calculation even though NZ student loans are interest-free for NZ-based borrowers. However, because student loans have no interest cost, they are typically lower priority to pay off than other debts when managing your DTI.

Can I still get a mortgage with a DTI over 6×?

Possibly — banks are allowed to make up to 20% of their new owner-occupier lending to borrowers with a DTI above 6×. However, competition for that 20% quota is high and banks will apply stricter criteria. Speaking to a mortgage adviser gives you the best chance of finding a lender willing to work with a higher DTI.