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Home Affordability Calculator

Updated January 2026

A home affordability calculator helps you determine how much house you can afford based on your income, debts, and down payment. Using the 28/36 rule, get a lender-approved budget before you start house hunting.

How to Use This Calculator

Enter your annual household income, monthly debt payments, down payment amount, expected interest rate, loan term, annual property tax rate, and annual home insurance. The calculator will show your maximum affordable home price, estimated monthly payment, and how the 28/36 rule applies to your situation.

How It's Calculated

The 28/36 rule determines your maximum housing payment: 28% of gross monthly income for housing (front-end) and 36% for total debt including housing (back-end). The amortization formula is solved in reverse to find the maximum loan amount given your affordable monthly payment, then your down payment is added to find the maximum home price.

Frequently Asked Questions

Most lenders follow the 28/36 rule: your monthly housing payment should not exceed 28% of your gross monthly income, and your total debt payments (including the new housing payment) should not exceed 36%. On an $80,000 annual salary ($6,667/month), the front-end limit is $1,867/month and the back-end limit is $2,400/month. After accounting for existing debts (say $500/month), your max housing payment is $1,867. At 6.5% interest, that supports about a $290,000 loan — plus your down payment determines the max home price.
The 28/36 rule is a widely used mortgage lending guideline. The "28" means no more than 28% of your gross monthly income should go toward housing costs (principal, interest, taxes, insurance, PMI, and HOA). The "36" means no more than 36% should go toward total debt (housing plus all other debt payments like car loans, student loans, and credit cards). Some lenders allow higher ratios — up to 43% or even 50% — with strong compensating factors like excellent credit.
Your down payment directly affects how much house you can afford in two ways. First, a larger down payment means a smaller loan, which lowers your monthly payment. Second, a down payment of at least 20% eliminates PMI, reducing your monthly cost by $100–$300 per month. For a $400,000 home, a 10% down payment ($40,000) results in a higher monthly payment than a 20% down payment ($80,000) due to both the larger loan and PMI costs.
Homeownership costs go far beyond the mortgage payment. You'll need to budget for property taxes (0.5–2.5% of home value annually), homeowners insurance ($1,000–$2,000/year), PMI if down payment is under 20%, maintenance and repairs (experts recommend 1% of home value per year), HOA fees ($100–$500+/month), utilities, and closing costs (2–5% of purchase price). This calculator includes all of these to give you a true affordability picture.

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