Free Home Affordability Calculator
Calculate how much house you can afford using the 28/36 rule. Enter income, debts, and down payment to find your max home price instantly.
Best next links
Go deeper without getting lost
We're using this page to help push you toward NumberPond's strongest calculators and category hubs — the pages most people actually want next.
Related hubs
Max Home Price
$363,785
Max Monthly Payment
$1,983
Estimated Loan Amount
$313,785
Down Payment
$50,000 (13.7%)
Formula
28/36 Rule: Max housing ≤ 28% of gross monthly income; total debt ≤ 36%. Max loan derived from payment using standard amortization.How Much House Can You Afford?
This calculator uses the industry-standard 28/36 rule to determine the maximum home price you can afford. It considers your income, existing debts, down payment, interest rate, and loan term to give you a realistic budget for your home search.
How the 28/36 Rule Works
The 28% rule limits your monthly housing payment (principal + interest + taxes + insurance) to 28% of your gross monthly income. The 36% rule limits your total monthly debt payments (housing + car loans + student loans + credit cards) to 36% of gross income. Your maximum payment is the lower of these two limits.
What Affects Your Home Affordability?
Income is the biggest factor — higher income means a higher budget. Existing debts reduce your available budget through the 36% rule. Down payment directly increases your purchasing power — every dollar of down payment is a dollar of home price that doesn't need financing. Interest rates dramatically affect affordability — a 1% rate increase reduces your buying power by roughly 10%.
Steps to Buying Your First Home
- Check your credit score — aim for 740+ for the best rates, minimum 620 for conventional loans
- Save for a down payment — 20% avoids PMI, but 3-10% is possible with certain loan programs
- Get pre-approved — shows sellers you're serious and locks in your rate for 60-90 days
- Budget for closing costs — typically 2-5% of the home price, due at closing
- Don't forget the hidden costs — maintenance, repairs, and furnishing a new home add up quickly
When Renting Makes More Sense
If you plan to move within 3-5 years, renting is often cheaper than buying when you factor in closing costs, maintenance, and transaction fees. Use the price-to-rent ratio in your area: if the home price divided by annual rent is above 20, renting may be the better financial move.
Frequently Asked Questions
What is the 28/36 rule?
The 28/36 rule is a guideline used by lenders: your monthly housing costs (mortgage, taxes, insurance) should not exceed 28% of your gross monthly income, and your total monthly debt payments should not exceed 36%. If your existing debts are high, the 36% limit may reduce your home budget more than the 28% limit.
How much do I need for a down payment?
Conventional loans require 3-20% down. Putting down 20% avoids Private Mortgage Insurance (PMI), which costs 0.5-1% of the loan annually. FHA loans allow as little as 3.5% down. VA and USDA loans offer 0% down for eligible buyers. A larger down payment means a smaller loan and lower monthly payments.
What costs besides the mortgage should I plan for?
Budget for property taxes (1-2% of home value/year), homeowner's insurance ($1,000-3,000/year), PMI if applicable, HOA dues ($200-500/month in some areas), maintenance (1% of home value/year), and utilities. These can add $500-1,500/month beyond your mortgage payment.
Does my credit score affect how much I can afford?
Absolutely. A higher credit score (740+) gets you lower interest rates, which means lower monthly payments and a higher affordable home price. The difference between a 6% and 7% rate on a $300,000 loan is about $200/month — or roughly $72,000 over 30 years.
Should I buy the most expensive home I can afford?
No. The 28/36 rule shows the maximum, not the target. Buying below your max gives you breathing room for savings, investments, emergencies, and lifestyle. Many financial advisors suggest keeping housing costs at 20-25% of income for a more comfortable budget.