Home Affordability Calculator
How much house you can afford (28/36 rule)
On a $90,000 salary with $500 of monthly debts and $40,000 saved, the 28/36 rule lenders use caps your house payment at $2,100, which buys a home of about $293,244. Enter your own income, debts and down payment to see how much house you can afford, with PMI priced in whenever your deposit is under 20%.
What the 28/36 rule actually caps
Two limits run at once, and whichever bites first sets your budget:
- The 28% front-end ratio caps your total housing payment — principal, interest, property tax, insurance, PMI and any HOA fee — at 28% of gross monthly income.
- The 36% back-end ratio caps that housing payment plus every other monthly debt at 36% of gross income: car loans, student loans, minimum credit-card payments and any other monthly obligation. Groceries, utilities and subscriptions do not count. Lenders measure debt, not lifestyle.
On $90,000 of income the 28% cap is $2,100 a month. The 36% cap is $2,700 minus your other debts. The calculator names which one is binding, because that tells you what to fix: a 28%-limited budget only moves if income or the loan terms change, while a 36%-limited one moves the moment you clear a car payment.
Why your other debts may not matter at all
This surprises most people. Below a certain level, paying off debt does nothing whatsoever for your budget, because the 28% housing limit is already the tighter of the two.
| Other monthly debts | Payment cap | Max home price | Which limit binds |
|---|---|---|---|
| $0 | $2,100.00 | $293,244 | 28% housing |
| $250 | $2,100.00 | $293,244 | 28% housing |
| $500 | $2,100.00 | $293,244 | 28% housing |
| $750 | $1,950.00 | $273,646 | 36% total debt |
| $1,000 | $1,700.00 | $240,984 | 36% total debt |
$90,000 income, $40,000 down, 6.5% over 30 years, 1.1% property tax, $1,500 insurance.
At this income the crossover is $600 a month. Below it, clearing debt buys you nothing extra in mortgage affordability; above it, every $100 of monthly debt costs roughly $13,000 of house. If you carry a $450 car payment, the useful question is not whether to pay it off but whether it pushes you past $600 in total.
The PMI cliff at 20% down
Under 20% equity, lenders add private mortgage insurance — assumed here at 0.5% of the loan a year, in line with the mortgage calculator, which shows the full monthly payment for a specific price once you have one in mind. It is charged monthly, it counts against the same 28% cap, and it therefore shrinks the house you can buy.
| Down payment | Max home price | Deposit as % of price | Monthly PMI |
|---|---|---|---|
| $20,000 | $275,639 | 7.3% | $106.52 |
| $40,000 | $293,244 | 13.6% | $105.52 |
| $60,000 | $310,849 | 19.3% | $104.52 |
| $66,000 | $330,000 | 20.0% | none |
| $80,000 | $342,757 | 23.3% | none |
| $100,000 | $360,224 | 27.8% | none |
Look at what happens between $60,000 and $66,000. An extra $6,000 of deposit adds $19,151 to the price you can reach, because crossing 20% deletes the PMI line and frees that money for principal and interest. The previous $20,000 only bought $17,605. Saving the last few thousand to reach 20% is worth several times what the same money does anywhere else in this table.
Affordability tools that ignore PMI overstate the budget of every buyer under 20% down. If a calculator does not ask about your deposit percentage, it is quietly assuming you have 20% — and quoting you a house you cannot get approved for.
How much house can I afford on my salary?
The old rule of thumb is three to five times income. At today's rates the honest answer sits at the bottom of that range and barely moves with income.
| Gross annual income | Payment cap (28%) | Max home price | Multiple of income |
|---|---|---|---|
| $50,000 | $1,166.67 | $165,172 | 3.30× |
| $60,000 | $1,400.00 | $202,171 | 3.37× |
| $75,000 | $1,750.00 | $257,669 | 3.44× |
| $90,000 | $2,100.00 | $313,167 | 3.48× |
| $100,000 | $2,333.33 | $350,165 | 3.50× |
| $125,000 | $2,916.67 | $442,662 | 3.54× |
| $150,000 | $3,500.00 | $535,158 | 3.57× |
| $200,000 | $4,666.67 | $720,151 | 3.60× |
No other debts, 20% down, 6.5% over 30 years, 1.1% property tax, $1,500 insurance.
The multiple drifts from 3.30 to 3.60 as income rises, because the fixed insurance premium matters less at the top. Anyone quoting five times income is either assuming much lower rates, no property tax, or a lender who will not actually approve it.
What the interest rate does to your budget
Rates move affordability more than almost anything within your control, and the effect is large enough to reprice a whole search.
| Mortgage rate | Max home price | Change from 6.5% |
|---|---|---|
| 3% | $389,289 | +$96,045 |
| 4% | $357,370 | +$64,126 |
| 5% | $329,237 | +$35,993 |
| 6% | $304,480 | +$11,236 |
| 6.5% | $293,244 | — |
| 7% | $282,706 | −$10,538 |
| 8% | $263,543 | −$29,701 |
$90,000 income, $500 other debts, $40,000 down, 30-year term.
Roughly every point of rate is worth $20,000–$30,000 of price at this income. It also explains why the same salary bought so much more house a few years ago, and why waiting for a rate cut is a real strategy rather than wishful thinking — though prices tend to rise when rates fall, which cancels part of the gain.
What this cannot see
Affordability and approval are different questions. A lender also weighs your credit score, employment history, the loan programme, the property's own appraisal, and reserves after closing. FHA and VA loans use different ratios entirely, and many lenders will stretch past 36% for a strong file.
There is also a gap between what you can borrow and what you should. The 28/36 rule is a lending limit, not a budget: it makes no allowance for childcare, commuting, retirement saving or the maintenance an owner pays and a renter does not. A useful discipline is to run the number here, then run your real monthly budget at that payment and see what is left.
Nor does it see the cash the purchase needs beyond the deposit. Closing costs typically run 2 to 5% of the price, and moving, early repairs and an emergency fund come out of the same savings. A payment you can carry on paper can still leave you with no cushion, so count those before you stretch to the top of the range.
An estimate, not a lending decision or financial advice. Get pre-approved for a figure you can rely on.
What the home budget assumes
The payment cap is the lower of 28% of gross monthly income and 36% of gross monthly income minus other monthly debts. The maximum price then solves the payment identity backwards: with a loan of price − down payment, price = (cap − insurance − HOA + down × (k + pmi)) ÷ (k + tax + pmi), where k is the amortised principal-and-interest payment per dollar of loan.
- PMI is 0.5% of the loan a year below 20% equity, matching the assumption used by the mortgage calculator. Real PMI ranges from roughly 0.3% to 1.5% depending on credit score and loan-to-value, so treat this as a mid-range estimate.
- The 20% threshold is solved, not assumed. Because PMI makes the payment jump at exactly 80% loan-to-value, the calculator solves the price both with and without it and keeps whichever answer is self-consistent. Where a budget straddles the line, the honest maximum is exactly 20% down — the PMI would cost more than the extra house is worth. On a $66,000 deposit at $90,000 income, that lands precisely on $330,000.
- Property tax is a percentage of price, so it scales with the answer; insurance and any HOA fee are flat monthly amounts.
- 28/36 is a convention, not a law. FHA, VA and portfolio lenders use different ratios, and many will exceed 36% for a strong application. Credit score, reserves and the property appraisal are outside this model.
- Gross, not net income. Lenders test ratios before tax, which is why the affordable payment can look large next to your actual take-home pay.
Reviewed September 2026.
Sources, checked
- What is a debt-to-income ratio?, Consumer Financial Protection Bureau. How lenders measure debt against gross monthly income.
- When can I remove private mortgage insurance (PMI) from my loan?, Consumer Financial Protection Bureau. Cancellation on request at 80% loan-to-value and automatic removal at 78%.
Figures reviewed . Every worked example on this page is checked against the calculator above.
Home Affordability Calculator: frequently asked questions
How much house can I afford on my salary?
At current rates, roughly 3.3 to 3.6 times gross income with 20% down and no other debts — $313,000 on a $90,000 salary, for example. The old 'four to five times income' guidance assumes much lower interest rates than today's.
What is the 28/36 rule?
Housing costs stay at or below 28% of gross monthly income, and total debt payments at or below 36%. Both are tested and the tighter one sets your budget; the calculator tells you which is binding.
Do I need to pay off my car loan before buying a house?
Only if your total monthly debts exceed about 36% minus 28% of gross income — around $600 a month on a $90,000 salary. Below that the 28% housing cap is already the tighter limit, so clearing debt adds nothing to your budget.
How does PMI affect how much I can afford?
PMI is charged monthly and counts inside the same 28% cap, so it directly reduces the price you can reach. Going from $60,000 down to $66,000 — crossing 20% — adds $19,151 of buying power, more than three times what the money would do otherwise.
Does this include property taxes and insurance?
Yes. The payment cap covers principal, interest, property tax, home insurance, PMI where it applies, and an optional HOA fee — the full PITI figure lenders test, not just principal and interest.
How much does a higher interest rate cost me?
About $20,000 to $30,000 of home price per percentage point at a $90,000 income. Moving from 6.5% to 8% cuts the maximum price by $29,701 with everything else unchanged.
Does an HOA fee reduce what I can afford?
Considerably. Lenders count it inside the 28% housing limit, so a $300 monthly HOA fee cuts the maximum price from $293,244 to $254,049 — about $39,000 of house.
Is the maximum price what I should actually spend?
No. It is a lending ceiling, not a budget. It makes no allowance for childcare, retirement saving, commuting or the maintenance that comes with ownership. Run your real monthly spending at that payment before committing.