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You Can Afford
Max Home Price
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Front-end Ratio (28% max) 0%
Back-end Ratio (36% max) 0%
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Principal & Interest
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Affordability Meter
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Monthly Payment at Different Home Prices
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How the Home Affordability Calculator Works
This mortgage affordability calculator uses the industry-standard 28/36 rule to determine how much house you can afford. The front-end ratio caps your total housing payment (principal, interest, taxes, insurance, and HOA) at 28% of your gross monthly income. The back-end ratio ensures your total debt load — housing costs plus existing debts — stays at or below 36%.
The calculator takes the more conservative of the two limits, so if your existing debts are high, the back-end ratio may reduce your maximum home price below what the front-end ratio alone would allow.
How to Improve Your Home Affordability
- Increase your down payment: A larger down payment reduces your loan amount and eliminates PMI once you reach 20%. Even an extra $10,000 down can meaningfully lower your monthly payment.
- Pay down existing debts: Reducing car payments, student loans, or credit card balances directly improves your back-end ratio, letting you qualify for a larger mortgage.
- Improve your credit score: A higher credit score qualifies you for lower interest rates. Even a 0.5% rate reduction on a $300,000 loan saves roughly $100/month.
- Consider a longer loan term: A 30-year mortgage has lower monthly payments than a 15-year, increasing the price you can afford — though you pay more in total interest.
- Shop for better rates: Get quotes from at least 3–5 lenders. Rates can vary by 0.5% or more between lenders for the same borrower profile.
- Look in lower-tax areas: Property taxes vary dramatically by location. A home in a 0.5% tax area costs significantly less monthly than the same-priced home in a 2.5% tax area.
Hidden Costs of Homeownership
Your mortgage payment is just the starting point. Budget for these often-overlooked expenses:
- Closing costs: Typically 2–5% of the purchase price, paid upfront. On a $350,000 home, that is $7,000–$17,500.
- Maintenance and repairs: Plan for 1–2% of your home's value annually. For a $350,000 home, that is $3,500–$7,000 per year.
- Utilities: Homeowners typically pay $200–$400+/month more than renters for water, gas, electricity, trash, and internet.
- Private mortgage insurance (PMI): Required if your down payment is less than 20%. Costs 0.5–1.5% of the loan amount annually.
- HOA fees: Can range from $100 to $500+ per month depending on the community and amenities.
- Landscaping and lawn care: $100–$300/month if you hire out, or significant time investment if you DIY.
- Home warranty: $300–$600/year for basic coverage, often wise for older homes.
Frequently Asked Questions
How much house can I afford on a $100,000 salary?
On a $100,000 annual salary with no other debts, you can typically afford a home priced between $300,000 and $450,000, depending on your down payment, interest rate, and location. Lenders generally use the 28/36 rule: your mortgage payment should not exceed 28% of gross monthly income, and total debt payments should stay below 36%.
What is the 28/36 rule for mortgage affordability?
The 28/36 rule is a guideline lenders use to determine how much you can borrow. The front-end ratio (28%) means your total housing costs — including mortgage principal, interest, taxes, and insurance — should not exceed 28% of your gross monthly income. The back-end ratio (36%) means your total monthly debt payments, including housing costs plus car loans, student loans, and credit cards, should not exceed 36% of gross monthly income.
How does my down payment affect how much house I can afford?
A larger down payment reduces your loan amount, which lowers your monthly payment and may qualify you for a better interest rate. With 20% down, you also avoid private mortgage insurance (PMI), saving $100–$300+ per month. For example, on a $400,000 home, putting 20% down ($80,000) versus 5% ($20,000) could save you over $500/month in combined PMI and principal/interest payments.
Should I choose a 15-year or 30-year mortgage?
A 15-year mortgage has higher monthly payments but saves significantly on total interest — often 50–60% less than a 30-year loan. A 30-year mortgage offers lower monthly payments and more flexibility. Choose 15 years if you can comfortably afford the higher payment and want to build equity faster. Choose 30 years if you need lower payments or want to invest the difference elsewhere.
What hidden costs should I budget for when buying a home?
Beyond the mortgage payment, budget for: closing costs (2–5% of home price), property taxes (0.5–2.5% annually), homeowners insurance ($1,000–$3,000/year), private mortgage insurance if under 20% down, HOA fees ($200–$500+/month in some areas), maintenance and repairs (1–2% of home value per year), utilities, and potential special assessments. These can add $500–$1,500+ to your monthly housing costs.
How do interest rates affect my home buying power?
Interest rates have a dramatic impact on affordability. For every 1% increase in rate, your buying power drops roughly 10%. For example, at 6% interest on a 30-year loan, a $2,000/month payment supports about a $333,000 mortgage. At 7%, that same payment only supports about $300,000. A 2% rate difference on a $350,000 loan can mean over $150,000 more in total interest paid over 30 years.
What credit score do I need to buy a house?
For a conventional mortgage, most lenders require a minimum credit score of 620, though 740+ gets you the best rates. FHA loans accept scores as low as 580 with 3.5% down, or 500 with 10% down. VA and USDA loans don't have official minimums but most lenders want 620+. Every 20-point increase in your score can save 0.125–0.25% on your rate, potentially saving tens of thousands over the life of the loan.
How much should I save before buying a house?
Plan to save: your down payment (3.5–20% of purchase price), closing costs (2–5% of purchase price), an emergency fund covering 3–6 months of housing costs, and a moving/furnishing budget. For a $350,000 home with 10% down, this means roughly $35,000 down payment + $10,000–$17,500 closing costs + $7,000–$14,000 emergency fund = $52,000–$66,500 minimum.