House Affordability Calculator
Find out how much house you can afford using the 28/36 rule based on your income and debts.
Car payments, student loans, credit cards, etc.
Maximum Home Price
$0
28% Housing Limit
$0/mo
36% Total Debt Limit
$0/mo
Binding Constraint
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How Does the House Affordability Calculator Work?
Determining how much house you can afford is one of the most important steps in the home-buying process. This calculator uses the widely accepted 28/36 rule, which most lenders rely on to evaluate mortgage applications. The rule establishes two key thresholds for your debt-to-income ratio to ensure you can comfortably manage your housing costs alongside other financial obligations.
The 28% Front-End Ratio
The first part of the rule states that your total monthly housing expense, including mortgage principal, interest, property taxes, and insurance, should not exceed 28% of your gross monthly income. For example, if you earn $100,000 per year, your monthly gross income is approximately $8,333, and your maximum housing payment would be about $2,333.
The 36% Back-End Ratio
The second threshold considers all of your monthly debt payments combined, including housing, car loans, student loans, and credit card minimums. This total should not exceed 36% of your gross monthly income. If you have significant existing debts, the 36% rule may limit your affordable home price more than the 28% rule.
The calculator takes the more restrictive of the two limits, subtracts your existing debts from the allowable housing payment, and uses the standard mortgage amortization formula to back-calculate the maximum loan amount and home price based on your interest rate, loan term, and down payment percentage.
This calculator is for informational purposes only and does not constitute financial, tax, or legal advice. Always consult a qualified professional for decisions specific to your situation.