About the Mortgage Affordability Calculator
Lenders decide how much you can borrow largely from your debt-to-income ratio. The common 28/36 rule says your monthly housing cost should stay under 28% of gross monthly income, and all your debt payments under 36%. This calculator works backward from those limits — plus your down payment, rate, taxes, and insurance — to estimate the home price and loan you can realistically afford.
How it’s calculated
Maximum monthly housing budget is the lower of 28% of gross monthly income and (36% of income − existing monthly debts). We subtract estimated monthly taxes and insurance from that budget, divide by the payment-per-dollar of loan to get the maximum loan, and add your down payment to get the maximum home price.
Example calculation
On a $90,000 income with $500/month of other debts and $40,000 down at 6.5% over 30 years, the 28/36 rule allows roughly $2,100/month for housing — supporting a home price in the low-to-mid $300,000s once taxes and insurance are included.
Frequently asked questions
What is the 28/36 rule?
It's a common lending guideline: your monthly housing payment should stay at or under 28% of your gross monthly income, and your total monthly debt payments under 36%. This calculator uses the lower of those two limits.
Does a bigger down payment let me afford more?
Yes. A larger down payment reduces the loan needed for a given monthly payment, so the same budget can buy a more expensive home. It also lowers or removes PMI.
Is this the same as a mortgage pre-approval?
No. This is an estimate to help you set a budget. A pre-approval from a lender also considers your credit score, assets, employment, and the specific loan program.
This calculator provides estimates for educational purposes and should not be considered financial, tax, or legal advice. Your actual figures may vary with lender terms, fees, and market conditions.