Household income before taxes
Please enter your annual gross income.
Car, student loans, credit card minimums (exclude rent)
Please enter your down payment.
30-year fixed rate (check Bankrate for today’s rate)
Your county rate. US average approx. 1.1%
Affordable Home Price
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⚠️ Disclaimer: Estimates based on common lending guidelines. Actual qualification depends on credit score, employment, assets, and lender requirements. Always get pre-approved before shopping.
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Sources & Methodology
Affordability formula verified against Bankrate 28/36 rule methodology and CFPB mortgage guidance.
Bankrate — The 28/36 Rule Explained
bankrate.com — The 28/36 affordability guideline, front-end and back-end ratio definitions.
CFPB — How Much Can I Borrow for a Mortgage?
consumerfinance.gov — CFPB guidance on qualifying income, DTI limits, and mortgage affordability factors.
Max PITI (front-end) = Gross monthly income x front-end limit. Max PITI (back-end) = (Gross income x back-end limit) minus existing monthly debt. Effective PITI = minimum of the two. Home price solved by reverse-amortization then adding down payment.
Last reviewed: April 2026
How Much House Can You Afford?
Home affordability depends on four factors: income, existing debts, down payment, and current mortgage rates. Lenders use the debt-to-income ratio as their primary qualification metric.
The 28/36 Rule Calculation
Max Housing PITI = Gross Monthly Income × 28%
Example: $95,000/year = $7,917/month gross
Front-end max (28%): $7,917 x 0.28 = $2,217/month PITI
Back-end max (36%) - $400 debts: ($7,917 x 0.36) - $400 = $2,450/month
Effective max PITI: min($2,217, $2,450) = $2,217/month
Front-end max (28%): $7,917 x 0.28 = $2,217/month PITI
Back-end max (36%) - $400 debts: ($7,917 x 0.36) - $400 = $2,450/month
Effective max PITI: min($2,217, $2,450) = $2,217/month
Income to Home Price Reference
| Annual Income | Max PITI (28%) | Est. Home Price (7%, 20% down) |
|---|---|---|
| $60,000 | $1,400/mo | $190,000 – $210,000 |
| $85,000 | $1,983/mo | $270,000 – $300,000 |
| $120,000 | $2,800/mo | $380,000 – $420,000 |
| $160,000 | $3,733/mo | $510,000 – $560,000 |
💡 Pro Tip: Get pre-approved before you shop. Pre-approval reveals your actual borrowing capacity, shows sellers you are serious, and locks in your rate for 60-90 days. Compare pre-approvals from at least 3 lenders — rates can vary by 0.5% or more on the same loan.
Frequently Asked Questions
Spend no more than 28% of gross monthly income on housing (PITI) and no more than 36% on total debt. On $8,000/month gross, max housing is $2,240/month. Lenders may approve up to 43-50% DTI with strong credit and reserves.
The 28/36 rule states housing costs should not exceed 28% of gross monthly income (front-end ratio) and total debt should not exceed 36% (back-end ratio). It is the standard guideline used by conventional mortgage lenders.
The front-end ratio is your monthly PITI (principal, interest, taxes, insurance) divided by gross monthly income. Lenders prefer below 28% for conventional loans and below 31% for FHA loans.
The back-end DTI is total monthly debt (housing plus car, student, credit card payments) divided by gross monthly income. Most conventional lenders cap DTI at 43-45%. FHA allows up to 56.9% in some cases.
At $100,000/year ($8,333/month gross), the 28% rule gives a max PITI of $2,333/month. At 7% for 30 years with 10% down, that supports roughly a $350,000-$380,000 purchase price with minimal other debt.
PITI stands for Principal, Interest, Taxes, and Insurance. It is the total monthly cost used in affordability calculations. Property tax averages 1.0-1.5% of home value annually. Homeowners insurance averages 0.5-1% annually.
A larger down payment reduces the loan amount and eliminates PMI if 20% or more. On a $400,000 home: 10% down means a $360,000 loan at 7% = $2,395/month. 20% down means $320,000 loan = $2,129/month.
Conventional loans typically require 620 minimum, with best rates at 740+. FHA accepts 580 with 3.5% down. VA loans have no official minimum but most lenders require 620.
PMI (Private Mortgage Insurance) is required on conventional loans when down payment is below 20%. It costs 0.5-1.5% of the loan amount annually. On a $300,000 loan that is $1,500-$4,500 per year added to your PITI.
20% eliminates PMI and gives the lowest monthly payment. 10% is a common middle ground. FHA requires 3.5% with a 580+ score. Also budget separately for closing costs of 2-5% of purchase price.
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