How much house can I afford?
The honest answer is: it depends — on your income, your existing debts, your down payment, and the interest rate. But there's a simple framework lenders use, and once you know it you can estimate your number in a couple of minutes.
The 28/36 rule
Most lenders size a mortgage against two ratios. The front-end ratio says your total monthly housing payment shouldn't exceed about 28% of your gross (pre-tax) monthly income. The back-end ratio — your debt-to-income, or DTI — says all your monthly debt payments together (housing plus car loans, student loans, credit-card minimums) shouldn't exceed about 36%.
Some loan programs stretch the back-end limit to 43% or higher, but a higher ratio means a tighter monthly budget and less cushion for surprises.
What lenders actually look at
Beyond those ratios, four things move the number: your gross income, your other monthly debts (they eat directly into what's left for housing), your down payment (it lifts your price ceiling dollar-for-dollar and can remove mortgage insurance at 20%), and the interest rate (a one-point rate change can swing your buying power by tens of thousands of dollars).
Don't forget the costs beyond the mortgage
Principal and interest are only part of the monthly cost. Budget for property taxes, homeowners insurance, PMI (if you put down less than 20%), HOA dues, and ongoing maintenance — a common rule of thumb sets aside 1% of the home's value per year. These are why the maximum a lender approves is usually more than you should actually spend.
Estimate your number
Put your figures into the Home Affordability Calculator: it works backward from a DTI limit to a maximum loan and price. As an example, a $90,000 income with $500 of other monthly debts, $40,000 saved, a 6.5% rate and a 36% DTI supports a home price of roughly $388,000. Then pressure-test it with the Loan Calculator to see the real monthly payment, and — if you're not sure buying is right — the Rent vs Buy Calculator.
Frequently asked questions
What percentage of income should go to a mortgage?
A common guideline is no more than 28% of gross monthly income on housing, and no more than 36% on total debt. Lower is safer.
How much down payment do I need?
20% avoids private mortgage insurance and lowers your payment, but many loans allow far less down. A bigger down payment raises your price ceiling and cuts total interest.
Should I borrow the maximum I'm approved for?
Rarely. The approved maximum is a ceiling, not a target — buying below it leaves room for taxes, maintenance, and life.