How much house can you afford? Enter your income, monthly debts and down payment, and this home affordability calculator estimates the highest home price that fits standard lender guidelines, including property tax, insurance, PMI and HOA dues in the monthly payment.
Affordability by lending guideline
| Guideline | DTI limits | Max home price | Monthly payment |
|---|
Estimates only. Lenders also consider your credit score, cash reserves, employment history and loan program. Get pre-approved for an exact figure.
How this home affordability calculator works
Lenders decide how much you can borrow mainly with two debt-to-income (DTI) ratios. The calculator finds your maximum monthly housing payment under both limits, uses the lower one, then works backward to the highest home price whose full monthly cost fits that payment.
- Housing ratio (front-end DTI): your total housing payment (principal, interest, taxes, insurance, PMI and HOA) divided by your gross monthly income.
- Total DTI (back-end): your housing payment plus all other monthly debt payments, divided by your gross monthly income.
Example: with a $100,000 salary, $500 a month in other debts and $60,000 saved for a down payment, the 28% housing limit allows $2,333 a month and the 36% total limit allows $3,000 minus $500, or $2,500. The lower figure, $2,333, applies. At a 6.5% rate on a 30-year loan with 0.9% property tax, $1,500 a year of insurance and 0.5% PMI, that payment supports a home of about $348,900.
The 28/36 rule and other DTI guidelines
The 28/36 rule is the classic affordability guideline: spend no more than 28% of gross income on housing and no more than 36% on all debts combined. Actual loan programs allow more:
| Guideline | Housing ratio | Total DTI |
|---|---|---|
| Classic 28/36 rule | 28% | 36% |
| FHA standard ratios | 31% | 43% |
| FHA with compensating factors | Varies | Up to 50% |
| Fannie Mae, manually underwritten | No set limit | 36%, up to 45% with strong credit and reserves |
| Fannie Mae, Desktop Underwriter | No set limit | Up to 50% |
The table under the calculator shows your budget at three levels. For the example above, the conservative 28/36 limits support about $348,900, FHA-style 31/43 ratios about $382,300, and a 50% total DTI about $527,000. Being approved for the higher number doesn’t mean the payment will be comfortable, so many buyers aim for the conservative figure.
What affects how much house you can afford
Using the same $100,000 income example, here’s how each factor changes the maximum home price:
| Change | Max home price |
|---|---|
| Starting example (6.5%, 30 years, $500/mo debts) | $348,900 |
| Interest rate 1 point lower (5.5%) | $376,000 |
| Interest rate 1 point higher (7.5%) | $325,100 |
| Income of $150,000 | $504,700 |
| 15-year loan instead of 30-year | $288,600 |
| $300 a month HOA dues | $308,800 |
| Property tax of 1.8% instead of 0.9% | $317,100 |
| $1,500 a month in other debts | $248,100 |
- Interest rate: every percentage point changes your budget by tens of thousands of dollars. A better credit score is one of the most reliable ways to get a lower rate; start by checking your credit report for errors.
- Existing debts: once your debts are high enough, the total DTI limit takes over. In the $1,500 debt example, each $100 a month of debt you pay off raises your budget by about $14,100.
- Property tax and HOA dues: these come out of the same monthly payment, so high-tax areas and HOA communities lower the price you can afford.
- Down payment: a bigger down payment lowers the loan amount, and putting 20% down removes PMI.
- Loan term: a 15-year loan saves a lot of interest but has higher payments, so it supports a lower price.
What counts as monthly debt
Include minimum payments that show up on your credit report or that you’re legally required to pay: car loans, student loans, personal loans, minimum credit card payments, and child support or alimony. Don’t include your current rent (it will be replaced by the new mortgage), utilities, phone bills, insurance premiums or groceries.
Beyond the monthly payment: cash you’ll need
Your savings have to cover more than the down payment. Plan for closing costs, moving expenses, initial repairs, and an emergency fund that still leaves several months of expenses in the bank after you buy. Some lenders also require cash reserves equal to a few months of mortgage payments.
Next steps
Use the button in the calculator to send your numbers to our mortgage calculator, where you can see the full amortization schedule and test extra payments. When you’re ready to shop, a mortgage pre-approval tells you exactly what a lender will offer, and first-time buyers should check whether they qualify for first-time home buyer programs with lower down payments.
Frequently asked questions
How much house can I afford on a $100,000 salary?
With $500 a month in other debts, a $60,000 down payment and a 6.5% rate, the 28/36 rule supports a home of about $348,900, with a total monthly payment around $2,333. Using FHA-style 31/43 ratios, the same buyer could reach about $382,300.
What is the 28/36 rule?
The 28/36 rule says your housing payment should be no more than 28% of your gross monthly income and your total debt payments, including housing, no more than 36%. It is a conservative guideline; many loan programs allow higher ratios.
What is the maximum debt-to-income ratio for a mortgage?
It depends on the loan program. Fannie Mae allows up to 50% for loans approved through its Desktop Underwriter system and 36% (up to 45% with strong credit and reserves) for manually underwritten loans. FHA’s standard ratios are 31% and 43%, with up to 50% possible with compensating factors.
Does the calculator use gross or net income?
Gross income, meaning your pay before taxes and deductions. That’s how lenders calculate debt-to-income ratios. Because your take-home pay is lower, check that the payment also fits your monthly budget.
Should I buy the most expensive home I qualify for?
Not necessarily. Lender limits show the maximum you can borrow, not what is comfortable. Leaving room for savings, repairs and other goals usually means aiming below your maximum approval amount.
This calculator provides estimates for educational purposes only and is not financial advice. Actual approval depends on your lender, credit profile and loan program. Sources: Fannie Mae Selling Guide B3-6-02 (debt-to-income ratios); FHA debt ratio limits (HUD Handbook 4000.1).