Estimate the home price you can afford from your income, debts, down payment and rate.
$459,555.11
Max monthly payment
$3,100.00
Loan amount
$419,555.11
Lenders qualify borrowers not by gut feeling but by debt-to-income (DTI) ratios. This calculator shows how your annual income, existing monthly debts, and down payment set the ceiling on home price you can afford. It factors in principal, interest, taxes, and insurance (PITI) — the four components that make up your monthly housing payment. Many lenders follow the 28/36 rule: your housing costs should not exceed 28% of gross income, and total debt (including the mortgage) should not exceed 36%. This tool uses your target DTI to back out the maximum home price.
A borrower with $120,000 annual income, $500 in monthly debts (car loan, student loan, etc.), and $40,000 down payment, shopping at 6% interest over 30 years, can afford a home price of approximately $459,555 with a maximum monthly payment of $3,100 (at 36% DTI).
If that same borrower pays down the car loan to $200 monthly, the freed-up DTI headroom raises the affordable home price to about $502,440 — a gain of roughly $42,885. Paying off debts before buying increases the price you qualify for.
How much house can I actually afford?
This calculator estimates the maximum based on DTI ratios that lenders use. However, affordability also depends on your comfort with the monthly payment, savings rate, job stability, and long-term financial goals. Many financial advisors suggest buying below the lender-approved ceiling to maintain flexibility and reduce stress.
What is the 28/36 rule?
The 28/36 rule is a lending guideline: housing costs (PITI) should not exceed 28% of gross monthly income, and total debt payments (including the mortgage) should not exceed 36%. Lenders use these thresholds to approve loans, though some allow up to 43% total DTI in strong credit profiles.
Does my down payment change what I can afford?
Down payment itself does not change the maximum monthly payment your income allows. However, a larger down payment reduces the loan amount needed, which can lower the monthly payment and free up DTI budget for other debts or a higher price. This tool backs out the home price from your monthly capacity.