How Much Home Can I Afford?
Lenders often start with a simple rule of thumb: housing costs up to about 28% of your gross income, and all debts up to about 36%. Enter your numbers to see what price range that points to. It is a starting point for planning, not a loan approval.
About these numbers
Uses the 28/36 guideline (adjustable above): the housing payment is capped at the lower of the housing percentage of gross income and the total-debt percentage minus your other debt payments. The price is then solved so the payment fits, assuming a fixed-rate loan for the full term. Property tax, insurance, PMI, and HOA figures are illustrative defaults you can change. Lenders use their own criteria, so actual approval amounts may differ. Rates are hypothetical, not quotes.
This calculator is a hypothetical illustration for educational purposes only. Results are based on the assumptions you enter and the method described above, may vary with each use and over time, do not reflect any specific investment or the deduction of fees or taxes unless stated, and are not a guarantee of future results. The tool does not consider every investment, account type, or strategy that may be available to you. It is not investment, tax, or legal advice. Investing involves risk, including possible loss of principal. 4:8 Financial does not provide tax or legal advice; please consult your CPA or attorney regarding your specific situation.
Have a question about this?
A calculator can only go so far. We are happy to walk through your real numbers with you, at no cost.