Home Affordability Calculator
What the 28/36 rule says the income supports — front-end, back-end, and the loan the payment buys — framed as a rule of thumb, because that is all it is.
The 28/36 rule is a rule of thumb, not a pre-approval and not a lender guideline for your file. Nothing here says any lender will lend any amount — it shows what the classic budget rule leaves room for.
A RULE OF THUMB, NOT A PRE-APPROVAL. Lenders weigh credit, reserves, loan program, and compensating factors; plenty of sound loans sit outside 28/36 and plenty of 28/36-clean budgets are not loan-ready. For the real number, a lender’s pre-approval on your actual file is the only instrument that counts.
How the math works
Front-end limit: 28% of gross monthly income for housing. Back-end limit: 36% of gross income for housing plus all recurring debts. The housing budget is the smaller of (front-end limit) and (back-end limit − monthly debts). Subtract taxes, insurance, and HOA to get the principal-and-interest budget; the annuity factor converts it to a loan: payment × [(1 − (1 + i)^−n) ÷ i], with i the monthly rate and n the payments. Add the down payment for the top price.
A worked example
A $120,000 income ($10,000 gross a month) with $500 a month of debts: the front-end limit is 28% × $10,000 = $2,800. The back-end allows 36% × $10,000 = $3,600 minus the $500 of debts, leaving $3,100. The smaller figure governs: a $2,800 housing budget. With $500 a month of taxes, insurance, and HOA, the P&I budget is $2,300, which at 7% over 30 years supports a $345,707 loan — a $405,707 top price with $60,000 down.
Questions from the field
What is the 28/36 rule? Housing costs under 28% of gross income; all debts under 36%. A screening convention from conventional underwriting, useful as a first pass and nothing more.
Why does the back-end ratio matter? Car payments, cards, and student loans shrink the housing budget before the mortgage is sized. Two households with the same income and different debts afford different houses — this page shows by how much.
Can this replace a pre-approval? No — and it does not try. It tells you whether the conversation with a lender is likely to be pleasant, and what down payment closes the gap.
The other calculators
Want us to look at your shop?
The free tools cover the leaks most shops share. The free Snapshot is the one-on-one version: 15 free minutes with our team to pressure-test what you found and map your next step. No pressure either way — you leave with a short list you can act on yourself.
Book Your Free Snapshot — book your free 15-minute call first, then answer a few quick questions, so the call itself is spent on your shop, not on background.