Rent-to-Income Calculator

The rent-to-income ratio, explained for landlords

Approving a tenant who can't afford the rent is the most expensive mistake a landlord makes — it leads to late payments, eviction, and months of lost rent. The rent-to-income ratio is the first screen: a quick math check that tells you whether the rent is realistic for the applicant's income. This guide explains the numbers behind the calculator so you can read the result like an investor, not a guess.

The 30% rule — and why it's a floor, not a ceiling

The long-standing standard is that rent should not exceed 30% of a tenant's gross monthly income. Below that, the tenant has enough left for food, transportation, and debt — and your rent gets paid on time. Above it, the tenant is cost-burdened, and default risk climbs fast. In tight Metro Detroit submarkets you can sometimes push to 33–35% with a strong applicant, but 30% is the line most subsidy programs and underwriters use.

Why the back-end ratio matters more than rent alone

A tenant can pass the 30% rule and still be a bad bet — because rent isn't their only obligation. The back-end ratio adds monthly debt payments (car, student loans, credit card minimums) to the rent and compares the total to gross income. Most landlords and subsidy programs want this under 43%. A tenant at 28% rent-to-income but carrying heavy debt is riskier than the headline ratio suggests. The calculator shows both so you approve with the full picture.

What to do when the ratio is high

• •Require a guarantor. A co-signer with stronger income shifts the risk without turning away an otherwise good tenant.
• •Ask for additional reserves. First and last month plus a larger deposit gives you a cushion if things go sideways.
• •Verify income rigorously. Don't accept a pay stub screenshot. Get pay stubs, tax returns, or employer confirmation — and cross-check against the ratio.
• •Decline if it doesn't pencil. A vacant unit costs less than an eviction. When the math says no, trust the math.

How KPM Detroit screens tenants

We don't stop at the ratio. Every applicant goes through credit, criminal background, eviction history, income verification, and rental references — all compliant with Michigan landlord-tenant law and Fair Housing. That's how we keep a 98.4% tenant renewal rate and protect owners from the cost of a bad placement. See our full process on the tenant screening page.

Next step: full screening, not just a ratio

This tool gives you the affordability snapshot. For a tenant who clears the ratio, the real decision comes down to credit, eviction history, and verified income — and a free rental analysis shows you what the right rent is for your unit in the first place.