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Home Affordability Calculator

Find out exactly how much house you can afford — or break down payments on a target price. Based on income, debt, down payment, and the 28/36 lending rule.

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Home affordability is the maximum home price a buyer can qualify for based on the 28/36 lending rule: housing costs (mortgage, taxes, insurance) should not exceed 28% of gross monthly income, and total debt payments should not exceed 36%. On a $100,000 annual income with no existing debt and 20% down at 6.75%, the maximum qualifying home price is approximately $420,000 — though local property taxes significantly affect this.

Last updated: 2026-05-04
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Income & Debt
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Combined household income before taxes

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Car loans, student loans, credit cards, etc. (not utilities)

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Loan Details
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Taxes, Insurance & HOA
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US average is ~1.1%. Check your county assessor for local rate.

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Affordability Results
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Home Affordability — FAQs

Common questions about buying a home and qualifying for a mortgage.

Home affordability is the maximum home price a buyer can qualify for based on income, debt, and down payment — using standard mortgage lending guidelines. A common guideline is that your home should cost no more than 2.5–3× your gross annual income. On a $100,000 salary, that suggests a $250,000–$300,000 home. However, your actual affordability depends on your down payment, existing debt, credit score, and local property taxes. Lenders primarily use the 28/36 rule: housing costs should not exceed 28% of gross monthly income, and total debt should not exceed 36%. This calculator uses that rule to find your maximum.

The 28/36 rule is a standard lending guideline: your monthly housing costs (mortgage principal, interest, taxes, insurance — "PITI") should not exceed 28% of your gross monthly income, and your total monthly debt payments (housing + car loans + student loans + credit cards) should not exceed 36%. Lenders use this to assess risk. Some loan programs allow up to 43–50% total DTI for well-qualified borrowers with high credit scores.

A larger down payment reduces your loan amount, lowering your monthly payment and allowing you to afford a more expensive home within the same budget. It also eliminates PMI once you reach 20% down, saving $100–300/month. Every additional $10,000 down on a 30-year 7% mortgage reduces your monthly payment by about $67. Use this calculator to compare down payment scenarios side by side. To model your full mortgage schedule, visit our Mortgage Amortization Calculator.

DTI (debt-to-income ratio) is your total monthly debt payments divided by your gross monthly income. Front-end DTI covers housing costs only; back-end DTI includes all debt. Most conventional lenders cap back-end DTI at 43–45%. A lower DTI means you qualify for more house and better rates. Reducing existing debt before buying (car loans, credit cards) can significantly increase your home buying power. Model the debt payoff strategy with our Debt Payoff Calculator.

Yes. When your down payment is less than 20%, this calculator adds an estimated PMI cost of ~0.8% annually of the loan amount to your monthly payment. PMI (Private Mortgage Insurance) protects the lender — not you — if you default. It's typically removed once your equity reaches 20% of the original purchase price, either through principal paydown or appreciation. At that point, request removal from your lender in writing.

20% down is the traditional target to avoid PMI, but many programs allow much less: FHA loans require 3.5%, conventional loans go as low as 3%, and VA/USDA loans offer 0% down for qualifying borrowers. A smaller down payment means higher monthly costs but lets you buy sooner and keep more cash for emergencies. Saving aggressively? Use our Savings and Retirement Calculator to project your down payment timeline.

Beyond the mortgage, budget for: closing costs (2–5% of purchase price, paid upfront), property taxes (0.5–2.5% annually depending on location), homeowners insurance (~$1,200–$2,400/yr), HOA fees if applicable ($0–$1,000+/mo), maintenance and repairs (budget 1% of home value annually), and utilities. This calculator includes taxes, insurance, and HOA in your total monthly payment estimate.

The rent vs. buy decision depends on your local market, how long you plan to stay, and your financial situation. Generally, buying makes more sense if you'll stay 5+ years, have a stable income, and have saved a down payment plus emergency fund. Renting makes sense if you're unsure about location, need flexibility, or if local home prices make the math unfavorable. Use our Rent vs Buy Calculator to compare the true 10-year cost of each option.

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Disclaimer: This calculator provides estimates based on standard mortgage lending guidelines (28/36 DTI rule). Results are for informational purposes only and do not constitute financial or lending advice. Actual loan qualification depends on your credit score, employment history, loan type, lender criteria, and current interest rates. Consult a licensed mortgage professional for a personalized assessment.