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House Affordability Calculator
How much house will a lender actually approve? This house affordability calculator turns your income, monthly debts and down payment into a maximum price under DTI rules — and names the limit that really caps your budget.
See how this works on a $100,000 income — 3 real examples
Max home price — Conventional 28/36
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Max loan amount
$0
Monthly housing budget
$0
Front-end used (cap 28%)
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Back-end used (cap 36%)
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The marker is your selected guideline; the band is the price range between cautious and aggressive DTI rules for the same money.
Where the $0/mo goes at that price
Rate stress test
How your maximum price shifts if rates move −1% to +2% from today’s input.
Affordability by interest rateYour max price at every rate
The same solve repeated at each rate, holding your income, debts and down payment fixed. The highlighted row is your current rate.
| Rate | Max home price | Max loan | Monthly P&I |
|---|
How your home affordability is calculated
First, your monthly housing budget comes from the two DTI caps, where GMI is gross monthly income (annual income ÷ 12):
Budget = min( GMI × front% , GMI × back% − monthly debts )
Whichever term is smaller is the “binding limit” shown above. Then the calculator finds the largest price whose complete monthly cost fits that budget. Principal & interest on a loan of L uses the standard mortgage payment formula:
M = L · i(1 + i)n / ((1 + i)n − 1), i = rate/12, n = years × 12
and the all-in cost of a home priced P with down payment D is M(P − D) + P × tax%/12 + insurance/12 + PMI + HOA, where PMI is (P − D) × PMI%/12 charged only while the loan exceeds 80% of the price. Because PMI switches off exactly at 80% LTV, the cost curve is piecewise rather than one closed-form formula, so the engine solves for the largest affordable P by bisection, accurate to a tenth of a cent. Assumptions worth knowing: all figures are month-1 costs (taxes and insurance are not inflated over time), PMI uses its first-year rate on the original loan, and the defaults — 1.1% property tax, $1,500/yr insurance, 0.5% PMI — are US ballpark averages you should replace with local numbers. The stress table repeats the full solve at each rate.
The same $100,000 salary, three debt loads
One income, one $60,000 down payment, 6.5% for thirty years. Only the monthly debt payments change — and the answer moves in a strange way.
Nothing owed to anyone
max home price$341,334
- The 28% housing cap allows $2,333.33 a month, and that budget reaches a $341,334 price.
- The 36% ceiling would allow $3,000 for debts plus housing — nothing here comes close.
- PMI claims $117.22 of the budget, since $60,000 down is only 17.6% of this price.
With no debts, the housing cap is the only wall — income alone draws the line.
Load this example (opens in a new tab)A car payment tags along
max home price$341,334
- Same price. The 28% housing cap still binds first, so the car loan changed nothing.
- Debt headroom shrinks from $3,000 to $2,500, but housing never needed more than $2,333.33.
- The gap to the other wall is $166.67 a month — the room left before debts start to bite.
Paying this $500 off would not buy one extra dollar of house — the other cap rules.
Load this example (opens in a new tab)The debts take the wheel
max home price$283,839
- At $1,200 a month the 36% ceiling binds: the housing budget falls to $1,800.
- The price drops $57,495 against the lighter loads — about $82 of house per dollar of monthly debt.
- One consolation: the smaller loan sits below 80% of the price, so the PMI charge disappears.
Past the crossover, every extra dollar of monthly debt costs about $82 of purchase price.
Load this example (opens in a new tab)Illustrations only, not financial advice. Your own rate, taxes and insurance will differ — check with a qualified financial advisor before acting on any of this.
Home affordability rules of thumb for 2026
- Two ratios decide it. Front-end caps housing cost, back-end caps housing + all debts — lenders use the tighter one. Conventional is 28/36; FHA 31/43; VA ~41 total (or set your own).
- Know your binding limit. If front-end binds, paying off debt won’t help — a lower rate, longer term or bigger down payment will. If back-end binds, every $300 of debt crowds out ~$45k of mortgage.
- Rates dominate. One point of rate erases ~$23k of price on the defaults — stress-test before you shop.
- Gross, not take-home. DTI caps ignore taxes, retirement, childcare and ~1–2%/yr maintenance — so the max isn’t the target.
- Filter, don’t max out. Many planners keep housing near 25% of gross so a job change doesn’t turn the home into a burden.
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Frequently asked questions
How much house can I afford on my salary?
A rough shorthand is 3–4.5× gross annual income, but the real answer depends on your debts, rate and down payment. On this page’s defaults — $100,000 income, $500/mo of debts and $60,000 down at 6.5% for 30 years — the 28/36 rule supports a price of about $341,000. Move the income slider to map your own salary to a price instantly.
What is the 28/36 rule?
It is the classic conventional-lending guideline: housing costs (mortgage payment, property tax, insurance, HOA) should stay under 28% of gross monthly income, and housing plus all other debt payments under 36%. On $8,333 of gross monthly income that means a $2,333 housing budget and a $3,000 all-in debt ceiling. This calculator applies both caps and tells you which one binds.
What debt-to-income ratio do mortgage lenders require?
Traditional conventional guidance is 28% front-end / 36% back-end, but automated underwriting routinely approves back-end DTIs of 45–50% for borrowers with strong credit and cash reserves. FHA’s baseline is 31/43, and VA relies on a single ~41% total-DTI benchmark plus a residual-income test — switch the guideline dropdown to run the FHA or VA numbers. Qualifying at the maximum is not the same as being comfortable there.
What is the difference between front-end and back-end DTI?
Front-end counts housing costs only — principal, interest, taxes, insurance and HOA — as a share of gross monthly income. Back-end adds every other monthly debt payment: car loans, student loans, credit-card minimums. Your budget is set by whichever cap yields the smaller number, and the binding-limit readout above names it.
How does my down payment affect how much house I can afford?
Almost dollar-for-dollar: each extra $10,000 down adds close to $10,000 of price at the same monthly budget. Crossing 20% down does more, because PMI — about $117/mo on this page’s defaults — disappears and that freed-up cash flow supports additional loan. A larger down payment can also earn you a slightly lower rate. For a second home, expect lenders to want a bigger down payment — often 10% or more — while the DTI math stays the same.
How do monthly debts lower my home-buying budget?
Inside the back-end cap, every $1 of monthly debt payment is $1 less available for housing. At 6.5% over 30 years, a $300/mo car payment crowds out roughly $45,000 of mortgage. The catch: this only matters when the back-end limit is the binding one — if the front-end cap binds, paying off a credit card will not change your maximum price.
Do property taxes, insurance and HOA fees count toward my DTI?
Yes. Lenders qualify you on the full housing payment — principal, interest, taxes, insurance, HOA and any mortgage insurance (often called PITIA) — not just principal and interest. That is why the same income affords a noticeably cheaper house in a 2.2% property-tax state like New Jersey than in a 0.3% state like Hawaii.
Disclaimer: these calculators are educational tools, not financial advice. They model your inputs with published formulas, but they cannot know your full situation — for decisions with real stakes, talk to a qualified professional. Formulas and defaults last reviewed .