Home Affordability Calculator (US) 2026
Find max home price using Fannie Mae 28/36 rule — based on income, debts, and down payment.
On a $120,000 annual income ($10,000/mo gross) with $500/month in existing debts, the Fannie Mae 28/36 rule suggests a maximum home price of approximately $430,000–$470,000 at a 6.8% rate with 20% down. Your actual limit depends on credit score, debt-to-income ratio, and lender.
Maximum Home Price
$489,497.13
Maximum Loan Amount
$429,497.13
Max Monthly P&I
$2,800.00
Estimated Property Tax
$489.50/mo
Your DTI Ratio
33.00%
Fannie Mae guidelines: housing costs ≤28% of gross income; total debt ≤36% (DTI).
Fannie Mae guidelines: housing costs ≤28% of gross income; total debt ≤36% (DTI).
About This Calculator
The Fannie Mae 28/36 rule is the standard lender guideline for home affordability: housing costs (P&I + property tax + insurance + HOA) should not exceed 28% of gross monthly income, and total debt payments (housing + car loans + student loans + credit cards) should not exceed 36%.
Lenders look at your Debt-to-Income (DTI) ratio — total monthly debt ÷ gross monthly income. Conventional loans typically require a DTI below 45%; FHA loans allow up to 57% in some cases.
Factor all housing costs into your budget: mortgage payment, property taxes (national average 1.07%, but 2–3% in NJ, TX, IL), homeowner's insurance (~$1,500/year average), HOA fees if applicable, and maintenance (budget 1–2% of home value annually). On a $400,000 home, that's $4,000–$8,000 per year in maintenance.
How to Use
- 1Enter your gross annual income (before taxes).
- 2List all monthly debt payments: car loans, student loans, minimum credit card payments (not utilities or food).
- 3Enter your available down payment.
- 4Enter the current interest rate and preferred loan term.
- 5Review maximum home price, maximum loan, monthly P&I, and your resulting DTI ratio.
Formula & Methodology
Max Housing Payment = Min(Gross Monthly Income × 0.28, Gross Monthly Income × 0.36 − Monthly Debts). Max Loan = Max Housing Payment / Monthly Rate Factor. Max Home Price = Max Loan + Down Payment.
Frequently Asked Questions
What is the 28/36 rule for mortgages?
The 28/36 rule states that housing costs should stay under 28% of gross monthly income and total debt payments under 36%. This is the traditional guideline used by Fannie Mae and Freddie Mac. Some lenders allow higher DTIs for borrowers with excellent credit (760+), strong assets, or in high-cost areas.
How much house can I afford on a $100K salary?
On $100,000/year ($8,333/mo gross) with $500/month in other debts: the 28% rule allows $2,333/month for housing; the 36% rule limits total debt to $3,000, so max housing of $2,500. At 6.8% rate with 20% down over 30 years, that supports a home price of approximately $350,000–$390,000.
Does the affordability calculator include property tax?
This calculator estimates property tax at 1.2% of home value annually (national average). Actual rates vary widely: 0.3–0.5% in Hawaii, Alabama; 2–3% in New Jersey, Illinois, Texas. Use your target state's average for a more accurate estimate.
Sources & References
- Fannie Mae — Selling Guide: DTI Requirements
- CFPB — How Much Mortgage Can I Afford?
- NAR — Home Affordability Index
Last updated: 2026-04-12