How much house can I afford?

The figures on this page use a household earning $100,000 a year in Ohio, with $400.00 a month of other debt payments, $60,000 saved for the down payment, homeowners insurance of $1,500 a year and a 30-year fixed loan at 7.4%, the Freddie Mac weekly average as of October 15, 2026, for illustration. Property tax uses Ohio’s effective rate of 1.3138% from Census data. These are estimates from rules of thumb, not a lender’s decision.

The two ratios lenders use

The front-end ratio compares the full housing payment, principal and interest plus property tax, insurance, PMI and any HOA dues, with gross monthly income. The traditional ceiling is 28%.

The back-end ratio, also called debt-to-income, adds every other monthly debt payment: car loans, student loans, credit card minimums, child support. The traditional ceiling is 36%. That is where the “28/36 rule” comes from.

On $100,000, gross monthly income is $8,333.33. The front-end limit is $2,333.33 for housing. The back-end limit is $3,000.00 for housing and debts together, which leaves $3,000.00 less $400.00 for housing. Whichever is lower sets the payment, and here it is the Front-end ratio (28% of gross).

Three prices from one income

Target. At the 28/36 limits, the household can carry a monthly payment of $2,333.33, which supports a price of about $314,008.

Stretch. Many loan programs allow a back-end ratio up to 43%, and automated underwriting sometimes goes higher with strong credit and savings. At 43% the price rises to $414,777, with a monthly payment of $3,183.33. This is roughly the most a lender is likely to approve, and it leaves little room for anything else.

Cautious. Gross-income ratios ignore taxes, which take a different share in every state. A cautious budget starts from take-home pay instead: here $6,379.34 a month after federal and Ohio tax and FICA. Keeping housing and other debts within 25% of that points to $185,226, with a payment of $1,194.83. It is a deliberately conservative figure for households that also want to save, have children in daycare, or expect variable income.

The gap between the cautious and the stretch price is the real decision. Lenders will happily take you to the top of it.

What moves the number

Other debts. Every dollar of monthly debt counts against the back-end ratio. Adding a $500.00 car payment lowers the target price to $298,109, $15,899 less. Paying off a car loan before applying, or not taking one on while house hunting, often does more for the budget than a raise.

The interest rate. At 8.4% instead of 7.4%, the target price falls to $300,000, $14,008 less on the same income. Rates move week to week, so a pre-approval letter from three months ago may no longer match the market.

The PMI line. With $60,000 down, any price above $300,000 means borrowing more than 80% of the price, and private mortgage insurance is added to the payment. That step in the payment is why the target in several scenarios here lands exactly on $300,000: the price just above it costs noticeably more each month. Our PMI guide covers what it costs and when it ends.

Property tax. It is part of the payment, so a high-tax state lowers the price a salary supports. The same household in New Jersey, with an effective property tax rate of 2.1105%, has a target price of $300,000, and less take-home pay as well, $6,156.85 a month. County rates vary even more within a state; each state mortgage page lists them.

The loan term. A 15-year loan at 6.71% costs far less interest, but the higher payment supports a lower price: $275,954 at the same ratios.

Two incomes, one mortgage

Lenders add co-borrowers’ incomes together and apply the same ratios to the total, so a second earner raises the price roughly in proportion. They also add both borrowers’ debts, and they use the lower credit score of the two to price the loan, which can cost more than the extra income gains if one score is weak.

The cautious view deserves more weight here than for a single earner. A payment sized to two incomes leaves no slack if one stops, for parental leave, a layoff or a move to part-time work. A common test is whether the household could carry the payment, at least for a year, on the larger income alone. If not, the stretch price is a bet that both jobs continue.

Variable income needs the same care. Lenders usually average two years of bonus, commission or self-employment income, and may ignore a raise that has not yet shown up on a W-2. Your own budget should do the same.

Costs the ratios leave out

• Maintenance. Older homes in particular need a yearly budget for repairs, roofs, furnaces and appliances. It is not in any lender’s calculation.
• Closing costs. Lender fees, title insurance, prepaid tax and insurance, and in some states transfer taxes, are paid on top of the down payment.
• Utilities and commuting. A larger or more distant house costs more to heat, cool and drive to.
• An emergency fund. Spending every dollar of savings on the down payment leaves nothing for the first broken water heater.

Putting it together

Start with take-home pay, not salary. Decide what monthly payment leaves room for savings, then work back to a price with the affordability calculator, and check the full payment on real listings with the mortgage calculator, using the county’s property tax. The lender’s number is the ceiling, not the target.

Every figure on this page is computed by the same code as our calculators. How we calculate.