Debt-to-income ratio (DTI)
Your total debt divided by your gross annual income. Lenders and the banking regulator use it to measure how stretched a borrower is.
- DTI = total debts divided by gross income
- APRA limit applies at a DTI of 6 or more
- Includes existing home and investment loans
How it works
Total debts include home loans, investment loans, car loans and credit limits. Income is gross, before tax.
The APRA limit
Since 1 February 2026, banks can make no more than 20% of new lending at a DTI of 6 or more. The cap applies separately to owner-occupier and investor lending, so access to high-DTI loans is limited.
An investor with $1,200,000 of total debt and $200,000 of gross income has a DTI of 6.
Illustrative only. Figures are examples, not a forecast or recommendation.
Portfolio builders reach high DTIs quickly. The order of purchases and which lender you use can matter as much as the property.
Common questions
Does the limit ban DTIs above 6?
No. It caps the share of new loans banks can make at that level.
Do non-bank lenders follow the limit?
The APRA limit applies to authorised deposit-taking institutions such as banks.
Related terms
Sources
General information only. It does not consider your objectives, financial situation or needs, and is not financial, credit, tax or legal advice. Rules change, so check current law and get advice from a licensed professional before acting.