Home Affordability Calculator
Find out how much house you can afford based on your income, debts, and down payment. Uses the industry-standard 28/36 debt-to-income rule.
Income & Debts
Loan Details
How to Use This Calculator
Key Formulas
28% Rule Max Housing
Maximum monthly housing payment including principal, interest, taxes, and insurance.
36% Rule Max Total Debt
Maximum total monthly debt payments including housing and all other debts.
Max Mortgage from Payment
Reverse mortgage formula to find max loan amount from your max monthly payment.
How Much House Can You Really Afford?
Knowing how much house you can afford before you start shopping prevents heartbreak and wasted time. Lenders use the 28/36 rule as their primary guideline: no more than 28% of your gross monthly income on housing costs, and no more than 36% on total debt payments.
Housing costs include principal, interest, property taxes, homeowners insurance, and HOA fees (often called PITI+HOA). If your gross monthly income is $7,000, the 28% rule caps your housing payment at $1,960/month.
The 36% rule adds your other debts — car payments, student loans, credit card minimums. With $400/month in existing debts and $7,000 monthly income, your total debt cap is $2,520, leaving $2,120 for housing after subtracting existing debts.
A more conservative approach is the 25% rule, which keeps your total housing cost under 25% of take-home pay. This leaves more room for savings, investments, and lifestyle expenses — especially important if you are pursuing financial independence.
Your down payment significantly impacts affordability. With 20% down, you avoid PMI and reduce your loan amount. On a $350,000 home, thats a $70,000 down payment versus $17,500 at 5% down — but the 5% option adds PMI and $250,000+ more in total interest.
Frequently Asked Questions
What is the 28/36 rule?
The 28/36 rule means your monthly housing cost should not exceed 28% of gross monthly income, and your total monthly debt payments (housing + car + student loans + credit cards) should not exceed 36% of gross monthly income. Most lenders use this as a qualification guideline.
How much income do I need for a $400,000 house?
With 20% down ($80,000), a 6.5% rate, and 30-year term, your P&I is about $2,023/month. Add taxes and insurance (~$500/month), and you need roughly $9,000/month gross income ($108,000/year) to meet the 28% rule with no other debts.
Does the calculator include PMI?
This calculator focuses on the 28/36 debt ratio method. If your down payment is less than 20%, budget an additional $100–$300/month for PMI, which effectively reduces your maximum affordable price.
Should I max out what the bank approves?
No. Banks approve based on the 28/36 rule, but that leaves little room for savings, emergencies, or lifestyle. Most financial advisors recommend spending 25% or less of take-home pay on housing to maintain financial flexibility.