Find out how much house you can afford based on the 28/36 rule
Enter your annual income, monthly debt payments, down payment, interest rate and loan term. The calculator applies the standard 28/36 rule to estimate the maximum home price you can afford, plus a more conservative recommendation, and shows the associated monthly payment.
Lenders generally allow housing costs up to 28% of gross monthly income (front-end) and total debt up to 36% (back-end). The affordable price is solved from the monthly payment cap, working backward through the amortization formula at your rate and term.
At $95,000 annual income, 20% down and a 7.25% rate, the maximum affordable home price is about $332,031 with an estimated monthly payment of $2,398. Staying under the conservative recommendation keeps more breathing room in your budget.
The 28/36 rule is a standard guideline lenders use. The front-end ratio (28%) says your housing payment should not exceed 28% of your gross monthly income. The back-end ratio (36%) says total monthly debt payments should not exceed 36%.
With a $100,000 annual salary, $60,000 down, and typical debt, you can afford a home in the $350,000-$450,000 range depending on interest rates and local property taxes.
The recommended price uses a more conservative 25% front-end ratio instead of 28%. Lenders qualify you at the maximum, but that leaves little room for maintenance, tax increases, or life changes.