Home Affordability Calculator

Our home affordability calculator helps you find out exactly how much house you can afford in 2026 based on your income, monthly debts, down payment, and current mortgage rates. Enter your numbers and get three instant results — conservative, recommended, and maximum — across all four major loan types: conventional, FHA, VA, and USDA.

How to Use This Home Affordability Calculator

Using this calculator takes less than two minutes. Here is exactly what each input means and what to enter:

Annual Household Income: Enter your total gross (pre-tax) household income. If you are buying with a spouse or co-borrower, add both incomes together. Use your base salary — do not include overtime or bonuses unless they are guaranteed and documented.

Monthly Debt Payments: Enter the total of all your current minimum monthly debt obligations. This includes car loan payments, student loan minimums, credit card minimum payments, and personal loan payments. Do not include utility bills, groceries, subscriptions, or any expense that is not a formal debt obligation. This number directly affects how much home you can afford.

Down Payment: Enter the cash amount you plan to put toward the purchase. The larger your down payment, the smaller your loan, the lower your monthly payment, and — once you reach 20% of the home price — the more you can eliminate private mortgage insurance entirely.

Loan Type Tabs: Select the loan program you plan to use. Conventional loans follow Fannie Mae guidelines with 28/36 DTI limits. FHA loans allow a higher 31/43 DTI and require as little as 3.5% down for borrowers with a 580+ credit score. VA loans are available to eligible veterans and active military with no down payment required. USDA loans offer zero-down financing for eligible rural and suburban properties.

Loan Details (expandable): Set your mortgage rate, loan term, and state. Selecting your state automatically fills in the median effective property tax rate for that state, saving you the research. You can override the rate if you have a specific county rate in mind.

Advanced Costs (expandable): Fine-tune your property tax rate, homeowners insurance percentage, monthly HOA fees, and PMI/MIP rate. The calculator pre-fills sensible defaults — 0.35% for homeowners insurance and 0.50% for PMI — but these are fully editable.

How Much House Can You Afford? 2026 Salary Guide

The most common question home buyers ask is simple: how much house can I afford on my salary? The answer depends on your debts, down payment, and the interest rate you qualify for — but as a starting point, here are realistic 2026 estimates using a 7.0% mortgage rate, $400 in monthly debts, $40,000 down payment, and the standard 28/36 DTI rule.

These figures are estimates based on national median property tax (1.07%) and default insurance rates. Your actual number will vary based on your state, credit score, and the specific loan program you use. Run the calculator above with your exact numbers for a personalized result.

The 28/36 Rule Explained With Real Examples

The 28/36 rule is the most widely used guideline for home affordability and forms the basis of conventional mortgage underwriting. It states that your monthly housing payment (PITI — principal, interest, taxes, and insurance) should not exceed 28% of your gross monthly income, and your total monthly debt payments including housing should not exceed 36% of your gross monthly income.

Here is a real example. Suppose your household earns $85,000 per year — that is $7,083 per month gross. Applying the 28% front-end rule, your maximum monthly PITI is $1,983. Applying the 36% back-end rule with $400 in existing debt, your maximum total debt payment is $2,550, leaving $2,150 for housing. The binding constraint — the lower of the two — becomes your effective ceiling. In this case, the front-end limit of $1,983 is the binding number.

At 7.0% on a 30-year mortgage with $40,000 down, a $1,983 maximum PITI translates to a home price of approximately $275,000. This is the “Recommended” result our calculator shows for these exact inputs.

The rule exists for a reason. Lenders who follow the 28/36 guideline have historically seen the lowest default rates. Borrowers who stay within it have enough income left after housing costs to build emergency funds, contribute to retirement accounts, and handle unexpected repairs without financial stress.

Conventional vs FHA vs VA vs USDA — Which Loan Is Right for You?

The loan type you choose dramatically affects how much home you can afford. Each program has different DTI limits, down payment requirements, and costs built into the loan. Here is how they compare in 2026:

For most first-time buyers without VA eligibility, the choice comes down to FHA versus conventional. FHA allows a higher back-end DTI (43% vs 36%) which means you can qualify for a larger loan with more existing debt — but the mortgage insurance premium is more expensive and lasts the life of the loan unless you refinance. Conventional PMI is cancellable once you reach 20% equity, making it cheaper over time if you have decent credit.

Understanding PMI vs MIP — What They Cost and How to Eliminate Them

Private Mortgage Insurance (PMI) applies to conventional loans when your down payment is less than 20% of the purchase price. PMI protects the lender — not you — if you default. The cost typically runs 0.5%–1.5% of the loan amount annually, paid monthly. On a $275,000 loan, PMI at 0.5% adds about $115 per month to your payment.

The good news: PMI is cancellable. Under the Homeowners Protection Act, your lender must automatically cancel PMI when your loan balance reaches 78% of the original purchase price based on your scheduled payment. You can also request cancellation earlier once you reach 80% LTV through a combination of payments and appreciation — though you will typically need an appraisal to prove the value.

Mortgage Insurance Premium (MIP) applies to FHA loans and works differently. There are two components: an upfront MIP of 1.75% of the loan amount (added to your loan balance at closing) and an annual MIP of 0.55% for most borrowers. Unlike conventional PMI, FHA MIP on loans made after June 2013 with less than 10% down cannot be cancelled — it lasts for the life of the loan. This is a significant long-term cost that borrowers often underestimate.

For a $300,000 FHA loan, the upfront MIP adds $5,250 to your balance at closing, and the annual MIP adds approximately $138 per month. Over 30 years that is $49,680 in mortgage insurance alone — more than the down payment many FHA borrowers put down. This is why refinancing into a conventional loan once you reach 20% equity is a common and financially sound strategy for FHA borrowers.

2026 Conforming Loan Limits and FHA Limits

One of the most important numbers in home affordability is the conforming loan limit — the maximum loan amount that Fannie Mae and Freddie Mac will purchase from lenders. For 2026, the Federal Housing Finance Agency (FHFA) set the baseline conforming loan limit at $832,750 for a single-unit property in most areas of the country. In high-cost areas, the ceiling rises to $1,249,125.

Why does this matter? When your loan exceeds the conforming limit, you need a jumbo loan. Jumbo loans typically require higher credit scores (usually 700+), larger down payments (often 20%+), more cash reserves, and come with stricter underwriting. Our calculator displays a warning when your recommended home price would require a loan above $832,750 so you know when you are entering jumbo territory.

For FHA loans, the limits are different. The 2026 FHA floor — the minimum limit in low-cost areas — is $541,287 for a single-unit home, and the ceiling in high-cost areas matches the conforming limit at $1,249,125. These figures come directly from HUD’s Mortgagee Letter and are verified for accuracy. You can confirm current limits at FHFA.gov and HUD.gov.

Closing Costs in 2026 — What to Budget

Closing costs are one of the most overlooked expenses in the home buying process. Most buyers focus on the down payment and forget that closing costs add another 2%–5% of the loan amount on top of that. On a $275,000 home with $40,000 down, your loan is $235,000 — meaning closing costs could run $4,700 to $11,750. Combined with the down payment, your total cash needed at closing could be $44,700 to $51,750.

Closing costs typically include lender origination fees (0.5%–1% of loan), appraisal ($400–$700), title insurance ($500–$1,500), title search and settlement fees ($200–$500), attorney fees where required ($500–$1,000), prepaid interest for the remainder of the closing month, homeowners insurance premium for the first year, and property tax escrow (typically 2–3 months upfront). Some of these are negotiable — you can ask the seller to cover part of the closing costs as a seller concession, particularly in a buyer’s market.

Our calculator shows your estimated closing cost range below the result cards so you can see the full picture of cash needed — not just the down payment.

How Credit Score Affects Home Affordability in 2026

Your credit score does not just determine whether you qualify for a mortgage — it directly determines the interest rate you receive, which dramatically affects how much home you can afford. Here is the real-world impact of credit score on a $275,000 30-year mortgage in 2026:

The difference between an excellent credit score (760+) and a poor score (640–659) on a $275,000 mortgage is $279 per month and over $100,000 in total interest. That same $279 per month, applied to the 28% front-end DTI rule on an $85,000 income, translates to approximately $40,000 less in purchasing power. Your credit score is one of the highest-leverage actions you can take before applying for a mortgage.

Property Taxes by State — How Location Affects Affordability

Property taxes are the most variable cost in home ownership — and one of the least understood. Two homes with identical prices and mortgage rates can have monthly payments that differ by hundreds of dollars purely because of where they sit. Our calculator automatically fills in your state’s median effective property tax rate when you select a state, but understanding the range helps you make smarter location decisions.

The states with the highest effective property tax rates in 2026 include New Jersey at 2.23%, Illinois at 2.07%, and Connecticut at 1.79%. At the other end, Hawaii sits at just 0.32%, Alabama at 0.41%, and Colorado at 0.51%. This means a $400,000 home in New Jersey carries an annual property tax bill of approximately $8,920, while the same home in Hawaii costs just $1,280 per year in property taxes — a difference of $635 per month in your PITI payment.

Keep in mind that the rates in our calculator are statewide medians. Your actual rate depends on your specific county and municipality. Many high-tax states like New Jersey have enormous variation within the state — some counties run well above 2.5% while others sit closer to 1.8%. Always verify your specific county rate before finalizing your affordability calculations.

First-Time Buyer Programs and Down Payment Assistance in 2026

If you are buying your first home, you likely have access to programs that can significantly improve your affordability beyond what the standard calculator shows. Here are the main programs available to first-time buyers in 2026:

FHA Loans: The most widely used first-time buyer program. With a 580+ credit score, you can put as little as 3.5% down. On a $275,000 home that is $9,625 — compared to $55,000 for a 20% conventional down payment. The trade-off is the lifetime MIP discussed above. FHA loans are backed by HUD and available through most mortgage lenders nationwide.

VA Loans: If you are an eligible veteran, active duty service member, or surviving spouse, VA loans offer zero down payment, no PMI, and competitive rates — often lower than conventional rates. The only cost is a one-time funding fee of 2.15% for first-time use with zero down, which can be rolled into the loan. VA loans have no loan limit for borrowers with full entitlement, though lenders typically apply their own limits.

USDA Loans: Available for homes in eligible rural and suburban areas, USDA loans offer zero down payment and below-market interest rates. The property must be in a USDA-eligible area (check the USDA eligibility map) and the borrower must meet income limits, generally set at 115% of the area median income. The costs are a 1.0% upfront guarantee fee and 0.35% annual fee.

State and Local Down Payment Assistance (DPA): Most states offer down payment assistance programs for first-time buyers, typically structured as forgivable second loans or grants. These programs vary widely by state — some offer $5,000 to $10,000 in assistance, while others in high-cost states like California and New York offer $20,000 to $40,000 or more. Search your state housing finance agency website for current programs. Income limits and purchase price caps apply.

Fannie Mae HomeReady and Freddie Mac Home Possible: These conventional loan programs allow down payments as low as 3% with reduced PMI rates for borrowers at or below 80% of area median income. They also allow co-borrower income from non-occupant relatives — useful for buyers with family support.

Hidden Costs of Homeownership — The Full Picture

The mortgage payment is just the beginning. New homeowners are often surprised by the true total cost of owning a home. Here are the costs that do not show up in a standard affordability calculator but belong in your budget:

Maintenance and Repairs: The standard rule of thumb is 1%–2% of your home’s value per year in maintenance costs. On a $275,000 home that is $2,750 to $5,500 annually — $229 to $458 per month. Older homes, custom features, and high-cost areas push this higher. This covers routine maintenance like HVAC servicing, gutter cleaning, and appliance repairs, plus the occasional larger expense like a new roof ($8,000–$20,000) or water heater replacement ($1,000–$3,000).

Utilities: Homeowners pay all utilities — electricity, gas, water, sewer, trash — that renters often have covered. The average American household spends approximately $2,200 per year on electricity alone. Add gas, water, internet, and other utilities and the total can easily reach $4,000–$8,000 per year depending on climate, home size, and energy efficiency.

HOA Fees: If you buy in a community with a homeowners association, monthly fees typically range from $100 to $500, with luxury communities and high-rise condos often running $500 to $1,500 or more per month. HOA fees cover common area maintenance, exterior insurance on condos, and community amenities. Our calculator includes an HOA input so you can factor these in.

Property Taxes and Insurance Increases: Property taxes are reassessed periodically and tend to rise over time, particularly in appreciating markets. Homeowners insurance premiums have increased significantly in recent years in disaster-prone states — some Florida and California homeowners have seen premiums double or triple. Budget for annual increases of 3%–7% in these line items.

A conservative total cost of homeownership — mortgage PITI plus maintenance, utilities, and miscellaneous — runs 1.5x to 2x the mortgage payment alone for many homeowners. Keep this in mind when evaluating the maximum home price the calculator suggests.

Frequently Asked Questions

How much house can I afford on a $75,000 salary?

On a $75,000 salary with $400 in monthly debts, $40,000 down, and a 7.0% mortgage rate, our calculator estimates you can afford approximately $216,000 using the standard 28/36 rule (Recommended tier). With a larger down payment or lower debts, this number increases. If you qualify for an FHA loan, the higher 31/43 DTI limit may push your number closer to $250,000 depending on your specific situation. Use the calculator above for a personalized estimate based on your exact inputs.

What is the 28/36 rule for home buying?

The 28/36 rule states that you should spend no more than 28% of your gross monthly income on housing costs (PITI — principal, interest, taxes, and insurance), and no more than 36% on total monthly debt including housing. It is the standard used by conventional mortgage underwriters and the basis for the Recommended result in our calculator. Staying within these limits leaves room for savings, retirement contributions, and unexpected expenses.

What is the minimum down payment required in 2026?

The minimum down payment depends on your loan type. Conventional loans require as little as 3% down through programs like Fannie Mae HomeReady. FHA loans require 3.5% down for borrowers with a 580+ credit score, or 10% for scores between 500 and 579. VA loans and USDA loans both allow 0% down for eligible borrowers. A 20% down payment eliminates PMI on conventional loans and significantly reduces your monthly payment, but it is not required for most loan programs.

How does my credit score affect how much home I can afford?

Your credit score affects your mortgage interest rate, which directly affects how much home you can afford. The difference between a 760+ credit score and a 640–659 score on a $275,000 mortgage is approximately $279 per month at current 2026 rates. Applied to the 28% front-end DTI rule, that rate difference translates to roughly $40,000 less in purchasing power. Improving your credit score before applying — by paying down credit card balances and eliminating any errors on your credit report — is one of the highest-return actions a prospective buyer can take.

What is PMI and how much does it cost in 2026?

Private Mortgage Insurance (PMI) is required on conventional loans when your down payment is less than 20% of the purchase price. PMI protects the lender if you default — it provides no benefit to you as the borrower. In 2026, PMI typically costs 0.5%–1.5% of the loan amount annually. On a $235,000 loan (a $275,000 home with $40,000 down), PMI at 0.5% adds approximately $98 per month. PMI can be cancelled once your loan-to-value ratio reaches 80%, either through regular payments or home appreciation.

What is the conforming loan limit in 2026?

The 2026 conforming loan limit set by the FHFA is $832,750 for a single-unit property in most areas of the United States. In designated high-cost areas, the limit rises to $1,249,125. Loans above these limits are called jumbo loans and come with stricter qualification requirements — typically a 700+ credit score, 20% down payment, and additional cash reserves. Our calculator shows a warning when your calculated home price would push you into jumbo territory.

How much should I save for closing costs in 2026?

Budget 2%–5% of your loan amount for closing costs, separate from your down payment. On a $235,000 loan, that means $4,700 to $11,750 in closing costs. The exact amount depends on your lender, location, loan type, and whether you negotiate seller concessions. FHA and VA loans have specific fee structures — FHA charges an upfront MIP of 1.75% of the loan amount at closing, and VA charges a funding fee of 2.15% for first-time use with zero down. Always request a Loan Estimate from your lender within 3 business days of applying — it itemizes every closing cost so there are no surprises.

Can I afford a house on a $50,000 income?

Yes — with realistic expectations. On a $50,000 income with $400 in monthly debts, $20,000 down, and a 7.0% mortgage rate, our calculator estimates a recommended home price of approximately $118,000 using the 28/36 rule. In many parts of the country — particularly in the Midwest and South — homes in the $100,000–$150,000 range are available. If you qualify for a USDA loan (no down payment required in eligible areas) or have access to down payment assistance, your options expand further. The key is keeping existing debts low and saving as much as possible for down payment and closing costs before applying.

Related Calculators

Once you know how much home you can afford, these calculators help you plan the next steps:

• Mortgage Calculator — Calculate your exact monthly payment, total interest, and amortization schedule for a specific loan amount
• Budget Planner — Build a complete monthly budget to confirm housing fits within your overall financial picture
• Debt Payoff Calculator — Plan to eliminate existing debts before applying, which directly increases your maximum home price
• 401(k) Calculator — Make sure buying a home does not derail your retirement savings plan
• Net Worth Calculator — Track how home equity builds your overall net worth over time