# Home Affordability Calculator > Under the 28/36 rule, housing costs can take 28% of gross income, so a $100,000 salary allows $2,333 a month. With $500 of monthly debts and $60,000 down, that buys a home of about $338,000 on a 30-year loan at 6.5%, with 1.1% property tax, $1,800 a year of insurance and PMI. - Interactive calculator: https://calculatorswithsteps.com/home-affordability-calculator - Category: Financial Calculators - Last updated: 2026-11-10 - Publisher: Calculators With Steps (calculatorswithsteps.com) ## How to use the home affordability calculator Choose how to work it out: - **Income and debts** – enter your annual gross income, monthly debt payments (car, student loan, card minimums) and the debt-to-income limits to apply. This is how lenders size a mortgage. - **Monthly budget** – enter the most you want to spend on housing each month. Use this for a stricter personal budget. Then fill in your down payment, mortgage rate, loan term, property tax rate, insurance, HOA dues and PMI rate. The calculator finds the highest price whose full monthly payment fits, shows the breakdown, and compares the maximum price under each common guideline. ## How the maximum home price is calculated Lenders apply two limits based on your gross monthly income: 1. **Front-end (housing) limit** = income × housing ratio, for example 28% 2. **Back-end (total debt) limit** = income × total ratio, for example 36%, minus your other monthly debts Your housing budget is **the smaller of the two**. The calculator then searches for the highest home price, to the nearest $100, where **P&I + property tax + insurance + PMI + HOA ≤ housing budget** P&I uses the standard mortgage formula on the price minus your down payment. PMI is added only when the down payment is under 20% of the price, so the search handles the jump in cost at that point exactly. ### Which DTI limits to choose - **28/36 (conservative, default)** – the classic rule of thumb. 36% is also Fannie Mae's base limit for manually underwritten loans. - **28/43 (moderate)** – keeps housing at 28% but allows more other debt. 43% was the long-standing cap for a qualified mortgage and is still common. - **31/43 (FHA standard)** – HUD's standard ratios for manually underwritten FHA loans. - **Custom** – enter your lender's ratios. Fannie Mae's automated underwriting can approve up to 50% total DTI, but a payment that large leaves little margin. ## Worked example: $100,000 salary Income $100,000, $500 of monthly debts, $60,000 down, 6.5% for 30 years, 1.1% property tax, $1,800 a year of insurance, 0.5% PMI, 28/36 limits: | Step | Amount | | --- | --- | | Gross monthly income | $8,333.33 | | Housing limit (28%) | $2,333.33 | | Total-debt limit (36% − $500) | $2,500.00 | | Housing budget (smaller) | $2,333.33 | | **Maximum home price** | **$338,000** | | Principal and interest on $278,000 | $1,757.15 | | Property tax | $309.83 | | Insurance | $150.00 | | PMI | $115.83 | | **Total monthly payment** | **$2,332.82** | The price works out to 3.38 times income. Under FHA's 31/43 limits the same buyer reaches about $370,700. With a $75,000 income the 28/36 answer is about $273,400, and with $150,000 it is about $490,400. ## What changes the answer most - **The interest rate.** Each percentage point moves the affordable price by roughly $22,000 to $26,000 in the example. - **Other debts.** Every $100 of monthly debt payments reduces your back-end room by $100. A car payment can cost you tens of thousands in buying power. - **Down payment.** Reaching 20% removes PMI. With $80,000 down the example price rises to about $371,500. - **Loan term.** A 15-year loan has a higher payment, so the affordable price drops to about $281,000, though you build equity much faster. - **Taxes and insurance.** High property tax or insurance costs eat into the same monthly budget. ## Before you shop The maximum is not the target. Leave room for closing costs (often 2% to 5% of the loan), moving, repairs and savings. Check your ratios with the [debt-to-income ratio calculator](https://calculatorswithsteps.com/debt-to-income-ratio-calculator), then price a specific home with the [mortgage calculator](https://calculatorswithsteps.com/mortgage-calculator). Getting preapproved tells you the rate and limits your lender will actually use. ## Frequently asked questions ### How much house can I afford with a $100k salary? About $338,000 with $60,000 down, $500 of other monthly debts, a 6.5% 30-year rate, 1.1% property tax and $1,800 a year of insurance, using the 28/36 rule. Under FHA's 31/43 limits the same buyer could stretch to about $370,700. ### What percentage of my income should go to a mortgage? The 28/36 rule says no more than 28% of gross monthly income on housing (principal, interest, taxes, insurance, PMI and HOA) and no more than 36% on all debts combined. FHA's standard limits are 31% and 43%. ### How much house can I afford based on a monthly payment? Choose Monthly budget at the top of the calculator and enter the most you want to pay. With $60,000 down at 6.5% and the default tax and insurance, a $2,500 monthly budget supports a home of about $359,800. ### How do interest rates change what I can afford? A lot. For the $100,000 example, the affordable price is about $363,500 at 5.5%, $338,000 at 6.5% and $315,600 at 7.5%, even though the monthly payment stays the same. ### How do my other debts affect how much house I can afford? They reduce the room left under the back-end limit. With $1,000 of monthly debts instead of $500, the 36% total-debt limit becomes the tighter one and the affordable price falls from $338,000 to about $299,900. ### What is the Dave Ramsey rule for how much house I can afford? Ramsey recommends a total house payment of no more than 25% of take-home pay on a 15-year fixed-rate mortgage. To test it here, choose Monthly budget, enter 25% of your take-home pay and select a 15-year term. ### How much do I need for a down payment? Conventional loans can start at 3% down and FHA loans at 3.5% with a 580 credit score, but under 20% down you will usually pay mortgage insurance. Raising the down payment from $60,000 to $80,000 in the example lifts the price to about $371,500 and removes PMI. ## Sources - [CFPB – Buying a house (tools and guides)](https://www.consumerfinance.gov/owning-a-home/) - [Fannie Mae Selling Guide B3-6-02 – Debt-to-income ratios](https://selling-guide.fanniemae.com/sel/b3-6-02/debt-income-ratios) - [HUD / Federal Register – FHA manual underwriting requirements (31/43 ratios)](https://www.govinfo.gov/content/pkg/FR-2013-12-11/html/2013-29170.htm) > Disclaimer: results are estimates for information and education, not financial advice. Confirm important decisions with a qualified professional.