How to use this calculator
- Enter your yearly income and monthly debt payments. Use income before taxes. Debts are minimum payments on loans and cards, not rent or utilities.
- Enter your down payment.
- Check the loan estimates. The defaults are typical; your lender can give you exact numbers.
How the budget is worked out: the 28/36 rule
Lenders look at your debt-to-income ratio (DTI): how much of your monthly income before taxes goes to debt.
- Comfortable budget: your full house payment is at most 28% of your monthly income, and all debts together are at most 36%.
- Stretch budget: house payment up to 36% and all debts up to 43%. Many lenders will approve this, but it leaves less room for savings and surprises.
The calculator finds the highest home price where the full payment (principal, interest, property tax, insurance, PMI and HOA) fits within those limits.
What this doesn’t include
Closing costs (often 2% to 5% of the price), moving costs, repairs and furniture all need cash beyond the down payment. Many people also keep three to six months of expenses in savings after buying. A budget that is technically affordable can still feel tight, so treat the comfortable number as the safer target.
Frequently asked questions
What is the 28/36 rule?
It is a common guideline: spend no more than 28% of your gross monthly income on housing, and no more than 36% on all debts including housing. It is a starting point, not a strict lender requirement.
How much income do I need for a $400,000 house?
It depends on your rate, down payment, taxes and other debts. Enter your numbers above and adjust the income until the comfortable budget reaches the price you want.
Do lenders count my rent or utilities as debt?
No. Debt-to-income counts loan and credit card payments that appear on your credit report, plus the new housing payment. Rent goes away when you buy, and utilities are not counted.