How Much House Can I Afford
Calculate your maximum home price using the 28/36 rule.
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This tool is for informational and educational purposes only. It is not a substitute for professional financial, medical, legal, or engineering advice. See Terms of Service.
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This calculator tells you the most expensive home you can buy while staying within safe debt limits. Here is how to use it:
- Enter your annual gross income. This is your pre-tax salary. If you have a co-borrower, add both incomes together.
- Enter your monthly debts. Include car payments, student loans, credit card minimums, and any other recurring obligations. Do not include rent, since that will be replaced by your mortgage.
- Set your down payment. The amount you plan to pay upfront. A larger down payment increases the home price you can afford.
- Adjust the interest rate and loan term. These affect your monthly payment and therefore your max purchase price.
- Set property tax rate and insurance. These vary by location but 1.2% tax and $1,500/year insurance are reasonable defaults.
The result updates instantly as you change any input. The calculator uses the 28/36 rule, which means your housing costs should not exceed 28% of gross income, and total debts should not exceed 36%.
About the 28/36 Rule
The 28/36 rule is the standard guideline used by most mortgage lenders. The "28" means your total housing payment (principal, interest, taxes, and insurance) should be no more than 28% of your gross monthly income. The "36" means your total monthly debt payments, including housing, should not exceed 36% of gross monthly income.
This calculator applies both rules and uses the more conservative result. If your existing debts are high, the 36% back-end ratio will be the binding constraint, limiting how much house you can afford.
Frequently Asked Questions
What is the 28/36 rule for mortgages?
The 28/36 rule states that your housing costs should not exceed 28% of your gross monthly income (front-end ratio), and your total debt payments including housing should not exceed 36% of gross income (back-end ratio). Most conventional lenders use these thresholds to determine mortgage eligibility.
Does this include property taxes and insurance?
Yes. Unlike a basic mortgage payment calculator, this affordability calculator accounts for property taxes and homeowner's insurance when determining your maximum home price. These are part of your total housing cost and affect how much you can borrow.
How much house can I afford on a $100,000 salary?
With a $100,000 salary, no other debts, 20% down, 6.5% rate, and 30-year term, you can typically afford a home around $380,000 to $420,000. The exact amount depends on your debts, down payment, local tax rates, and insurance costs. Use this calculator with your specific numbers for an accurate estimate.
Should I buy the maximum house I can afford?
Generally, no. The 28/36 rule sets the upper limit, but buying below your maximum gives you more flexibility for savings, emergencies, and lifestyle. Many financial advisors suggest keeping housing costs closer to 25% of gross income.