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Home Affordability & Max Income Ratio Calculator

Max purchase price from income, debts, rate, and a chosen housing-ratio cap (28/36 style).

Page updated 2026-09-04.

Home Affordability & Max Income Ratio Calculator visual
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Calculator

Default $8,500.

Cars, cards, student. Default $450.

Default 28%.

Default 36%.

Default 6.5%.

Default 30.

Default 20%.

Calculated Results

Max purchase price

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Max housing payment

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Max loan

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The binding constraint: front-end or back-end ratio

On $8,500/month gross income with $450/month in other debt, a 28% front-end ratio caps housing payment at $2,380/month, while a 36% back-end ratio (total debt including housing) allows up to $2,610/month before subtracting other debts. The lower of the two -- $2,380, the front-end limit -- is what actually binds in this example, giving a max housing payment (PITI) of $2,380.00.

That $2,380 PITI payment, amortized at 6.5% over 30 years, supports a maximum loan of $376,541.75. Grossed up for a 20% down payment, that translates to a max purchase price of $470,677.19.

Whichever ratio binds matters for what actually changes your affordability: since front-end is the limit here, paying off the $450/month other debt wouldn't increase how much home you can afford at all -- only a change to income, rate, term, or the front-end ratio itself would move the number.

Why this is a ceiling, not a target

Front-end and back-end ratios only. PMI, taxes, and insurer overlays vary by loan. This models the standard lending guideline (28/36 here, adjustable), but PITI includes taxes and insurance that this calculator's payment math doesn't separately itemize -- the $2,380 figure is a full housing-payment ceiling, not the P&I portion alone.

Lenders apply their own overlays on top of these standard ratios, and a lower down payment percentage than 20% typically triggers PMI, which effectively lowers the loan amount this same payment can support.

Income and term must be greater than zero for the calculation to run; a 0% down payment percentage means the full loan amount equals the purchase price with no equity cushion at closing.

Before you shop with this number

This is a maximum, not a recommended budget -- many buyers are more comfortable well below the 28/36 ceiling. Compare the resulting payment against your actual monthly budget with the Personal Net Worth Calculator and an emergency-fund check before treating this as a target.

Once you have a specific price and neighborhood in mind, plug the local mill rate into the Property Tax Estimator to see how much of that $2,380 ceiling taxes alone would consume.

Frequently Asked Questions (FAQ)

Why is the max housing payment $2,380 instead of the back-end-based $2,610?

Because the calculator takes the lower (more restrictive) of the two ratio-based limits. Front-end caps housing at 28% of $8,500 = $2,380. Back-end allows 36% of income minus other debts = $2,610. The lower one, $2,380, becomes the binding constraint -- lenders qualify you against whichever ratio you fail first.

If I pay off my other debts, does my affordability increase?

Only if back-end is currently the binding constraint. In this example, front-end ($2,380) is lower than back-end ($2,610), so paying off the $450/month debt wouldn't raise the max housing payment at all -- it would only help if back-end were the tighter limit.

Does the $2,380 PITI figure include property tax and insurance?

It's meant to represent the full housing payment ceiling (Principal, Interest, Taxes, Insurance), but the loan-amount math backs out only the loan portion assuming this payment covers P&I -- actual taxes and insurance reduce how much of that $2,380 is left for P&I specifically.

Does a smaller down payment than 20% trigger PMI?

In real underwriting, yes, typically for down payments under 20%. Front-end and back-end ratios only. PMI, taxes, and insurer overlays vary by loan. This calculator doesn't add a PMI cost to the payment, so affordability at a lower down payment percentage will be somewhat overstated versus a real loan estimate.

Are 28% and 36% the ratios every lender uses?

They're common conventional-loan guidelines, but FHA, VA, and individual lender overlays use different ratios -- some allow back-end ratios well above 36% for strong-credit borrowers. Adjust the front and back fields to match the loan program you're actually applying under.

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