Ask a mortgage lender how much house you can afford and they'll approve you for far more than you should actually spend. Lenders profit from bigger loans; you pay for them. Understanding the difference between 'maximum approved' and 'financially wise' is the single most important calculation you'll do before buying a home. This calculator gives you both numbers so you can choose intentionally.

The 28/36 rule is the traditional lending guideline. Front-end DTI (housing costs) should not exceed 28% of gross monthly income. Back-end DTI (all debt payments including housing) should not exceed 36%. These are old-school conservative — modern lenders push to 43% back-end under the federal Qualified Mortgage rule, and some FHA loans allow 50% with compensating factors. The higher the DTI, the more house you 'qualify for' — and the tighter every other line item in your budget becomes.

PITI is the critical acronym: Principal + Interest + Taxes + Insurance. Everyone remembers principal and interest. Almost nobody accurately estimates taxes and insurance until closing. Property tax varies dramatically by state — 2.5% in New Jersey, 0.3% in Hawaii. On a $400,000 home, that's $833/month in Jersey vs $100/month in Hawaii. Homeowners insurance ranges from $600–$4,000 annually depending on location, home age and flood zone.

The Dave Ramsey rule is much tighter: keep mortgage payment under 25% of monthly take-home pay, use a 15-year fixed mortgage, and put 20% down to avoid PMI. This locks you into a much smaller house than lenders offer — but leaves 75% of income for everything else. Emergency fund grows. Retirement contributions maximize. Family vacations happen. House-poor families spend the next decade rearranging deck chairs on a financial Titanic.

Property taxes deserve special attention because they escalate over time. Home appreciates? Tax bill rises. School district needs new funding? Tax bill rises. Nearby amenities improve? Tax bill rises. A house 'affordable' at today's $6,000/year tax may hit $10,000/year in 10 years. California's Prop 13 caps annual increases at 2%, but most states have no such protection. Always research 5-year tax history on any house you're serious about.

The forgotten expenses beyond PITI: HOA fees ($100–$1,000/month for condos and planned communities), private mortgage insurance if under 20% down ($100–$400/month), maintenance (1–2% of home value annually), utilities that scale with square footage, and major repairs ($5,000–$30,000 when they hit). Budget an additional 30–50% beyond PITI for total housing cost. A $2,000 PITI often means $2,600–$3,000 all-in.

Use this calculator to see both the lender maximum and the wisely conservative number for your income. Model different DTI thresholds to see how each affects home price. Combine with our Mortgage Payment and PMI calculators for the full picture, and always shop at 80% of your max approval — the financial breathing room will save your marriage, your retirement, and your sanity.