How Much House Can You Afford?
The 28/36 rule, what PITI really includes, and the difference between what a lender will approve and what you can comfortably afford.
The short version
- The 28/36 rule: keep housing costs under 28% of gross income and total debt under 36%.
- Your payment is PITI — principal, interest, property taxes, and insurance — not just the loan.
- A bigger down payment lowers your payment and can remove the need for PMI.
- What you qualify for and what’s comfortable are different numbers — aim below the ceiling.
A mortgage lender will happily tell you the largest loan you qualify for — and it’s often more than you should actually spend. Qualifying is about your paperwork; affording is about the life you want to keep living once the payment starts. Here’s how to find the number that works for you.
The 28/36 rule
The most widely used affordability guideline puts two ceilings on your budget:
- 28% front-end — your total housing payment should stay under 28% of gross monthly income.
- 36% back-end — all your debt payments together (housing plus car, student loans, credit cards) should stay under 36%.
On an $80,000 income, that’s about $1,867 a month for housing and $2,400 for all debt combined. Lenders use these same debt-to-income ratios to size your loan, so knowing yours tells you what to expect before you apply.
Your payment is more than the loan (PITI)
The mortgage payment lenders count isn’t just principal and interest — it’s PITI: Principal, Interest, property Taxes, and homeowners Insurance. On top of that can come private mortgage insurance (PMI) and HOA dues. Two homes at the same price can have very different monthly costs once taxes and insurance are in, so always budget the full PITI, not just the loan payment a rate quote shows.
The down payment changes everything
How much you put down drives the rest of the math. A larger down payment means a smaller loan, a lower monthly payment, and — once you hit 20% down — no PMI. It also strengthens your offer in a competitive market. You don’t always need 20%, but the closer you get, the more affordable the loan becomes month to month.
Qualified ≠ comfortable
Lenders approve you at the top of the ratios; they don’t know your childcare, travel, or savings goals. Borrowing at the very top leaves no room for emergencies or the rest of your life. Aim comfortably below the maximum, not at it.
Find your price
Enter your income, debts, down payment, and rate to see the home price and monthly payment that fit — using the same ratios lenders apply.
Have a price in mind already? Break down the monthly payment and total interest at today’s rates.
Sources
This article is for general education and is not financial, tax, or legal advice. Figures reflect published 2026 IRS and SSA amounts as of the date above; verify current limits with the linked sources or a qualified professional before acting.
About the author
David Miles is the founder of FigureMoney and builds independent, source-backed personal-finance tools across the Modern Site Builders network. Every calculator and guide cites the IRS, SSA, or primary research behind its numbers.
Calculators in this guide
Home Affordability Calculator
Find out how much house you can afford. Enter your income, debts, and down payment to see your target home price and monthly payment, using the 28/36 rule.
Mortgage Calculator
Free mortgage calculator. Estimate your monthly payment with principal, interest, taxes, insurance, and PMI, plus a full amortization schedule.
Debt-to-Income Ratio Calculator
Calculate your debt-to-income (DTI) ratio from your monthly debt payments and gross income — the number lenders use to approve a mortgage or loan.
Keep reading
What Is PMI, and How Do You Avoid It?
PMI is an extra monthly charge you pay to protect the lender when you put less than 20% down. Here’s what it costs, how to cancel it, and how to avoid it entirely.
15- vs. 30-Year Mortgage: Which Should You Choose?
The 15-year saves hundreds of thousands in interest; the 30-year costs less each month and leaves room to breathe. Here’s the real trade-off on a $400,000 loan.