How Much House Can I Afford? The 28/36 Rule Explained
2026-04-02 · 6 min read · Guide
The 28/36 Rule
Most lenders follow two DTI (debt-to-income) ratios:
28% Rule (Front-end): Your total housing payment (PITI: principal, interest, taxes, insurance) should not exceed 28% of your gross monthly income.
36% Rule (Back-end): Your total monthly debt payments (housing + car + student loans + credit cards) should not exceed 36% of gross income.
Quick Math
If you earn $75,000/year ($6,250/month):
Max housing payment: $6,250 × 28% = $1,750/month
At 6.8% interest, 30yr fixed, that supports roughly a $300,000 home (with 5% down, taxes, and insurance).
State Matters
Property taxes vary dramatically. In Texas (1.68% rate), your $300K home costs $420/month in taxes. In Hawaii (0.27%), it is only $68/month. That difference lets you afford a much more expensive home in low-tax states. See state-by-state estimates.
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