How much house can I afford?

Asking “How much house can I afford?” is the right place to start, and the answer is almost never a single number. Your income, debts, and credit, combined with your down payment, mortgage interest rates, loan type, property taxes, homeowners insurance, and comfort with a monthly payment all shape the answer. Start with a home affordability calculator to quickly estimate a budget, then use prequalification and mortgage preapproval to find a number that works for you.

Key takeaways:

• The 28/36 rule is a useful starting point: keep housing costs at or below 28% of your gross monthly income, and total monthly debt payments at or below 36%.
• Loan type changes the math. FHA, VA, USDA, conventional, and jumbo loans carry different down payment and qualifying rules, and any of them can move your budget.
• A calculator estimate is not an approval. Prequalification, and eventually a full application, give you a number that sellers and listing agents will take seriously.

DTI and the 28/36 rule

Your debt-to-income ratio (DTI) measures how much of your gross monthly income is taken up by debt payments. Lenders use it to make sure you have enough room in your budget to afford the mortgage payment on a loan.

The 28/36 rule is a rule of thumb that uses DTI as a budgeting guideline. The rule states that your housing costs, including the mortgage, taxes, insurance, and HOA fees, should total no more than 28% of your gross monthly income, and all your debts should total no more than 36%. You can estimate your payment with the mortgage calculator from Rocket Mortgage.

It isn’t an underwriting standard, and many lenders allow for a higher DTI, but it’s a sensible place to estimate how much you can afford before going to a lender.

At Rocket Mortgage, the maximum DTI depends on the loan product.

How much house can you afford by salary?

The examples below apply the 28% guideline to six income levels, then translate each payment into an approximate purchase price.

Each assumes a 30-year fixed loan at 6.66%, with 10% down and no other monthly debt. Taxes, homeowners insurance, and mortgage insurance are estimated together at 1.65% of the purchase price per year.

Factors that affect how much house you can afford

If you’re trying to buy a home, here are the factors lenders consider when you apply.

Income

Lenders care about stability as much as how much you earn. You need to show a 2-year history of earning bonuses, commissions, or self-employed income for lenders to consider it stable.

DTI

The lower your DTI, the more room you have for a mortgage payment. You have two levers for reducing DTI: earn more money or pay down your debts.

Down payment

A larger down payment allows you to borrow less and reduces your monthly payment. It also can help you get a lower mortgage interest rate and avoid mortgage insurance.

Credit

Most mortgage types consider your overall credit history, even though they no longer require a minimum credit score. Better credit can get you a lower interest rate and help you qualify for more types of loans, which may cost you less when it comes to fees and mortgage insurance.

Interest rate

A lower mortgage interest rate reduces your monthly payment on the same loan amount, which helps you afford more house for the same cost.

Loan term

A 30-year term spreads out repayment over a longer time, which reduces the monthly payment and can make a larger loan amount more affordable. A shorter term will have a higher monthly payment, which may limit how much you can borrow, but you’ll pay much less interest and be free and clear in less time.

Reserves

Reserves refer to having enough cash saved to afford your monthly mortgage payment for a specific number of months without additional income. Jumbo loans typically are the only loan type that requires cash reserves.

Fixed-rate vs. adjustable-rate mortgages (ARM)

Most loan types offer fixed or adjustable interest rates.

With a fixed-rate mortgage, your rate and your principal and interest payment stay the same for the life of the loan. Taxes and insurance can still increase, but the largest piece of the payment is predictable.

An ARM usually has a lower fixed interest rate for 5, 7, or 10 years, then adjusts on a set schedule according to market rates. Rate caps limit how much your rate can increase at any one adjustment and overall.

How mortgage loan types affect affordability

Loan type changes your minimum down payment, your qualifying guidelines, and whether mortgage insurance is part of the payment.

Conventional loans

Conforming conventional loans meet specific requirements, including a maximum loan amount, that allows lenders to sell them to Fannie Mae or Freddie Mac. For 2026, the baseline conforming loan limit for a one-unit property is $832,750 in most of the country, rising to $1,249,125 in high-cost areas. Down payments start as low as 3%, and private mortgage insurance applies with a down payment of less than 20%.

FHA loans

FHA loans are insured by the Federal Housing Administration and built for buyers with thinner credit files. Lenders, including Rocket Mortgage, require a minimum down payment of 3.5% and a credit score of 580 or higher. Other lenders may allow a credit score of 500 – 579 with a 10% down payment. Borrowers must pay an upfront and an annual mortgage insurance premium (MIP).

Loan limits cap how much house you can afford with FHA mortgages. For 2026, the one-unit forward mortgage limit varies from $541,287 to $1,249,125, depending on the county.

VA loans

VA-backed purchase loans are available to eligible military personnel, veterans, and their surviving spouses. They typically require no down payment and no mortgage insurance. The VA sets no minimum credit score, but lenders often do. Most borrowers pay a one-time VA funding fee, which can be waived for eligible veterans with service-connected disabilities and certain surviving spouses. Our guide to VA loan affordability covers how the funding fee fits your budget.

USDA loans

USDA loans allow low- to mid-income borrowers to buy a home in specific rural areas with no down payment. Household income generally cannot exceed 115% of the area median, and the home must be your primary residence. Rocket Mortgage currently does not offer USDA loans.

Jumbo loans

A jumbo loan is a conventional loan for more than the conforming loan limit for your county. Because these loans can’t be sold to Fannie Mae or Freddie Mac, lenders can set their own requirements. Expect stricter credit, DTI, and reserve requirements. If you’re shopping at the top of the market, our look at the salary needed for a $1 million home shows how those requirements stack up.

Other costs of homeownership

Make sure you understand all the costs involved in buying and owning a home when you’re figuring out what you can afford.

Closing costs

Closing costs cover the fees required to finalize your loan and transfer legal ownership of the home. This includes loan origination fees, title search, title insurance, the home appraisal, home inspection, escrow fees, and recording. They’re commonly estimated at 3% – 6% of the purchase price, due at closing in addition to your down payment.

Homeowners insurance

Lenders require homeowners insurance so the property can be repaired or rebuilt after covered damage. Premiums vary by region, so budget from a current quote, not a rule of thumb.

Property taxes

Property taxes are generally assessed as a percentage of your property’s value multiplied by the local rate, and they fund schools, parks, roads, and services. Two identically priced homes in different counties can carry very different tax bills.

PMI

Lenders require PMI on a conventional loan when your down payment is less than 20%. PMI protects the lender, not you. You can ask your lender to cancel PMI once you’ve paid down your loan balance enough to have 20% home equity. Your lender will cancel PMI automatically at 22%, as long as you’re current on the loan.

HOA fees

HOA fees cover shared maintenance, amenities, and community services in many condo, townhome, and planned neighborhoods. They can run to several hundred dollars a month. They can increase, and lenders count them in your housing expense ratio. Confirm current dues and any planned assessments before you offer.

Home maintenance

Maintenance is the cost buyers most often leave out. A common planning guideline is to set aside 1% – 3% of the purchase price each year, with older homes at the higher end.

How to make a home more affordable

If you need some help to meet mortgage requirements, here are some common steps that can help.

Improve your credit

Better credit generally means a better interest rate, and a better rate means a lower payment on the same loan. Pay every bill on time, keep card balances low relative to your limits, and avoid new accounts once the process starts.

Reduce your DTI

Paying down your debts or increasing your income reduces your DTI. You could ask for a raise, start a side-hustle, or get a better-paying job. Targeting debts with the highest minimum payments first can help you bring down your DTI more quickly, since it responds to monthly obligations instead of balances.

Save for a larger down payment

More money down means a smaller loan, a lower payment, and potentially no PMI. It also strengthens your offer. Our tips for saving for a house cover the practical ways to get there faster.

Choose a less expensive home

The simplest lever is the one buyers resist most. A starter home you can comfortably afford builds equity you carry into the next one.

What does it mean to be house poor?

Being house poor means buying a home that takes up so much of your income that you struggle to cover other expenses.

How to avoid becoming house poor

• Shop with a plan. Set your budget and must-haves before you tour anything, and skip listings above your range.
• Buy below your maximum. A home at the lower end of your approved range is the most reliable protection there is.
• Research local costs. Look into the area’s property tax history and any HOA fees, so you know which direction they’ve been moving.
• Be honest about repairs. A fixer-upper is a second budget. Price the work before you close.
• Match the loan to your timeline. A 30-year fixed keeps the payment lower and more predictable. An ARM can be more affordable if you expect to move or refinance before the lower introductory interest rate expires.
• Keep an emergency fund. Try to save several months of living expenses that you don’t touch for the down payment.

FAQ

Here are answers to common questions on creating a realistic home buying budget.

How much should you spend on a house?

Spend what fits your full financial picture, not what a lender approves. The 28% guideline is the standard benchmark, and buying below it leaves room for maintenance, savings, and rising costs. Our guide to how much you should spend on a house goes deeper into the trade-offs.

What are the upfront costs of buying a home?

The two largest are your down payment and closing costs, which typically run 3% – 6% of the purchase price. Beyond those, budget for earnest money, an inspection, an appraisal, moving costs, and repairs. See our breakdown of how much money you need to buy a house.

How much mortgage can you qualify for?

That depends on your loan program, DTI, credit score, down payment, reserves, and the lender’s review of your full file. Conventional, FHA, VA, and USDA loans apply different limits so that the same borrower can qualify for very different amounts. Prequalification is the fastest way to a real answer.

What percentage of your income should go to a mortgage?

The 28% front-end guideline is the common answer: no more than 28% of gross monthly income toward your total housing payment, taxes, and insurance included. Our article on what percentage of your income should go to a mortgage explains when it makes sense to go above or below that.

The bottom line: Only buy a house you can truly afford

Affordability has two answers, and only one comes from a lender. The 28/36 rule, your DTI, down payment, rate, and loan type set what you can be approved for. Taxes, insurance, maintenance, HOA fees, and your savings goals set what you can live with.

The Rocket Mortgage home affordability calculator can help you estimate how much you can afford. When you’ve accounted for all the costs and are ready to start shopping, mortgage preapproval can help you get a more specific estimate.

If you’re ready to buy a home, explore your borrowing options today with Rocket Mortgage.