House Affordability Calculator
How much home can you actually afford? Calculated using the 28% front-end rule and lender debt-to-income standards.
Before taxes
Car loans, student loans, credit cards
Max home price (28% rule)
$286,734
Max home price (3x rule)
$270,000
Max monthly housing payment
$2,100
Including est. taxes & insurance
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How lenders determine what you can afford
Mortgage lenders use two key ratios. The front-end ratio (28% rule): your total housing payment (principal, interest, taxes, insurance — PITI) should not exceed 28% of your gross monthly income. The back-end ratio (36% rule): all debt payments combined should stay under 36% of gross monthly income.
The 3x rule is a simpler alternative: home price should be no more than 3× your annual income. In high cost-of-living cities this is often impossible, but it's a useful sanity check to avoid overextending.
Down payment and PMI
Putting less than 20% down means paying Private Mortgage Insurance (PMI), typically 0.5–1.5% of the loan annually. This adds $150–450/month on a $300k loan. Saving for a 20% down payment avoids PMI entirely and gives you instant equity and a lower monthly payment.
Beyond the payment
Owning a home costs 1–3% of the home's value annually in maintenance and repairs. A $400k home may need $4,000–12,000/year for upkeep — often not budgeted by first-time buyers. Property taxes (0.5–2.5% of value) and homeowners insurance ($1,000–3,000/yr) also add to the true monthly cost.