House Affordability Calculator
It works out the highest home price your income supports, using the same two debt-to-income ratios a lender applies, and includes property tax and insurance in the monthly figure.
Home price you can afford
$413,792
Max home price
$413,792
Mortgage amount
$353,792
Monthly budget
$2,800.00
Principal & interest
$2,236.21
Monthly tax
$413.79
Down payment %
14.5%
The front-end cap is $2,800.00 and the back-end cap is $3,100.00. This is the maximum a lender would allow, not necessarily the amount that leaves room for savings and maintenance.
What it calculates
It works out the highest home price your income supports, using the same two debt-to-income ratios a lender applies, and includes property tax and insurance in the monthly figure.
Why it matters
Buyers routinely shop above what they can carry, then get declined or stretched. Knowing the number before viewing saves both wasted time and a badly stressed budget.
Who it's for
First-time buyers setting a budget, anyone getting pre-approved, and people checking how paying off a car loan would change what they can borrow.
Formula
- Front-end
- Housing costs as a share of gross monthly income, usually 28%
- Back-end
- All debt including housing, usually 36%
- PITI
- Principal, interest, taxes and insurance
- f
- Monthly payment factor for the rate and term
Worked example
$120,000 income, $500 of monthly debts, $60,000 down, 6.5% over 30 years
- 1Front-end cap = 10,000 × 28% = $2,800
- 2Back-end cap = 10,000 × 36% − 500 = $3,100
- 3The tighter cap wins: $2,800 a month
- 4Solve price where tax scales with the answer
About $413,800, or a $353,800 mortgage
How the house affordability calculator works
Lenders apply two ratios and take the tighter. The front-end ratio caps housing costs at a share of gross income; the back-end ratio caps all debt payments together, so a car loan directly reduces what you can borrow. The awkward part is that property tax scales with the purchase price, so the payment depends on the answer. Rearranging gives a closed form — price = (budget − insurance + down payment × f) ÷ (f + tax rate ÷ 12) — which avoids guessing and re-checking.
Lenders apply two ratios and take the tighter. The front-end ratio caps housing costs at a share of gross income; the back-end ratio caps all debt together, so a car payment directly reduces what you can borrow.
Property tax scales with the purchase price, so the payment depends on the answer. Rearranging gives a closed form rather than guessing and re-checking.
Common mistakes
- Budgeting on principal and interest alone and forgetting tax, insurance and any HOA fee.
- Using net income when lenders assess gross.
- Forgetting that a car payment can knock tens of thousands off your borrowing power through the back-end ratio.
Tips and best practice
- Clearing a small high-payment debt often raises your borrowing power by more than the debt itself.
- The maximum you can borrow and the amount you should borrow are different numbers.
- Run it at a rate a point higher than today's to stress-test the budget.
Frequently asked questions
How much house can I afford on my salary?
Most lenders cap housing costs at about 28% of gross monthly income and total debt at 36%. On $120,000 a year with $500 of other debts, that is roughly $2,800 a month, supporting a home around $414,000 with 20% down at 6.5%.
What is the 28/36 rule?
A lending guideline: housing costs stay under 28% of gross monthly income, and all debt payments together stay under 36%. The tighter of the two is what limits you.
Does my car payment affect how much house I can buy?
Substantially. It counts toward the 36% back-end ratio, so every $100 of car payment removes $100 from your available housing budget — often $15,000–$20,000 of borrowing power.
Is gross or net income used?
Gross, before tax. That is why the payment you qualify for can feel much heavier than expected once tax and deductions come out.
Should I borrow the maximum I qualify for?
Rarely. The cap is what a lender will allow, not what leaves room for savings, emergencies and the maintenance every home eventually demands.
Related calculators
Methodology & trust
- Formula source
- Conventional 28/36 debt-to-income underwriting ratios.
- Last updated
- 2026-07-28
- Privacy
- Every calculation runs in your browser. No inputs are sent to a server or stored.
- Accessibility
- Keyboard navigable, labeled inputs and WCAG AA color contrast.