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Home Affordability Calculator

Turn your income, debts, down payment, and rate into an affordable home price range — with the 28/36 guideline explained, not oversold.

“How much house can I afford?” has two answers, and they are not the same. The first is what a lender will approve. The second is what leaves room in your budget for everything else. This calculator starts from the second answer. It uses the 28/36 guideline: housing costs at or below 28% of gross monthly income, and all monthly debt payments combined at or below 36%. Those are guidelines, not laws and not any single lender's rule.

Worked example

Assumptions (labeled, illustrative): $90,000 gross annual income ($7,500/month); $500/month other debts; $40,000 down payment; hypothetical 6.5% rate, 30-year term; $450/month combined for property taxes, insurance, and HOA (user-style estimate, not a market figure).

Step	Calculation	Result
Front-end cap (28%)	$7,500 × 0.28	$2,100/month
Back-end cap (36%)	($7,500 × 0.36) − $500	$2,200/month
Binding housing budget	Lower of $2,100 / $2,200	$2,100/month
Left for principal + interest	$2,100 − $450	$1,650/month
Maximum loan at 6.5%, 30 years	$1,650 ÷ payment factor	About $261,000
Maximum purchase price	About $261,000 + $40,000	About $301,000

Two levers matter most. Paying off the $500 of other debts would lift the back-end cap to $2,700, but the binding budget would still be the $2,100 front-end cap — so in this example, extra down payment or a lower rate moves the price more than debt payoff does.

How this works

Assumptions

• 28/36 guideline: housing costs at or below 28% of gross monthly income; all monthly debts combined at or below 36%. The guideline is a budgeting aid, NOT a CFPB rule or a lender requirement — lenders set their own limits and many approve above these levels.
• Debt-to-income (DTI) per the CFPB: monthly debt payments divided by gross monthly income. Only debts count toward DTI for this calculator (car, student loans, credit-card minimums, support payments) — not groceries, utilities, or subscriptions.
• Binding housing budget = the lower of the front-end (28%) and back-end (36% minus other debts) caps. Principal-and-interest budget = binding budget minus taxes, insurance, HOA, and PMI.
• Maximum loan = principal-and-interest budget ÷ [r(1+r)^n ÷ ((1+r)^n − 1)], where r = monthly rate and n = total payments. Maximum price = maximum loan + down payment.
• Does not pre-approve, quote a rate, or account for credit score, reserves, employment history, or loan-program rules. Does not include closing costs, moving costs, maintenance, or utilities.
• Taxes, insurance, HOA, and PMI default to $0 on purpose: we do not pre-fill them with a “typical” rate presented as fact. Enter figures from a real listing, tax record, or insurance quote. (The worked example uses $450/month combined for these.)
• Nothing is stored or sent anywhere; all inputs are user-entered.

How we make money: Unpack Money earns $0 in affiliate revenue and has no approved affiliate programs. Educational only; not mortgage, tax, or financial advice. Rates, taxes, insurance, and lender requirements change — get a current quote from a lender before making an offer.

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