How Much House Can I Afford?

The 28/36 rule is the classic lender guideline. Your total monthly housing costs — principal, interest, property tax, homeowners insurance and PMI — should not exceed 28% of your gross monthly income (the front-end ratio), and your total monthly debt payments including housing should not exceed 36% (the back-end ratio). Some lenders approve higher back-end ratios, up to 43% for a Qualified Mortgage and up to 50% for FHA loans with strong compensating factors, but 28/36 is the comfortable, conservative benchmark this calculator uses.

With $100,000 of annual income, $500 a month in other debts, a $50,000 down payment, a 7% 30-year mortgage, 1.1% property tax, $175 a month of homeowners insurance and 0.6% PMI, you can afford a home of about $311,800 with a maximum monthly payment of $2,333. The 28% front-end limit is binding here — the 36% back-end limit would allow $2,500 a month. Change any input above to match your own situation.

Yes. The monthly payment is the full PITI payment — principal and interest, property taxes and homeowners insurance — plus PMI when your down payment is under 20% of the home price. That is the payment lenders actually qualify you on. Many simple calculators show principal and interest only, which understates the real payment by hundreds of dollars a month.

Private mortgage insurance (PMI) is required on most conventional loans when your down payment is under 20% of the home price. It protects the lender, not you, and typically costs 0.3% to 1.5% of the loan amount per year — this calculator uses 0.6% as a middle estimate. You can usually ask your lender to cancel PMI once you reach 20% equity, and under the Homeowners Protection Act it ends automatically when the loan balance reaches 78% of the original home value. FHA loans have their own mortgage insurance premium instead.

No. 7.18% is the national average 30-year fixed mortgage rate from Freddie Mac’s Primary Mortgage Market Survey for the week of November 5, 2026 (down from 7.24% the week before; 6.22% a year earlier). It is a benchmark, not an offer or a commitment to lend. The rate you are actually quoted depends on your credit score, down payment, loan size, property type and lender — use the rate slider to test the quote you received, and compare official Loan Estimates from several lenders before deciding.

Yes, in two ways. A bigger down payment means a smaller loan, so the same monthly payment buys a higher-priced home. And once your down payment reaches 20% of the price, PMI drops away entirely, freeing up roughly $100 to $200 a month on a typical loan. On the worked example above, raising the down payment to $62,356 (20% of the $311,782 price) removes the $131 a month of PMI and lifts the affordable price to about $339,900 on the same $2,333 monthly payment. Try raising the down payment slider to see the effect on your own numbers.