What is the 28/36 rule?

The 28/36 rule is Fannie Mae's underwriting standard. 28% front-end: your total housing payment (PITI) should not exceed 28% of gross monthly income. 36% back-end: housing + ALL other monthly debt payments should not exceed 36% of gross monthly income. Loans that fit both constraints are routine; loans that exceed either typically require lender exception or higher down payment.

What's the difference between comfortable price and stretch price?

Comfortable price = the maximum home price that fits the 28/36 rule (Fannie Mae standard). Stretch price = the maximum that fits the 43% QM (Qualified Mortgage) cap — the federal regulatory ceiling under CFPB's ATR/QM rule. Lenders WILL underwrite up to 43% DTI, but you're operating at the edge — small income disruption (medical, layoff) creates immediate distress.

Why is DTI the most important number?

Because it's what lenders actually decision on. They don't care that you 'feel' you can afford it — they care that the math fits their underwriting box. CFPB's ATR rule (12 CFR 1026.43) makes the 43% DTI cap legally binding on most QM mortgages. Below 43% = easy approval. Above 43% = exception territory (jumbo, portfolio lender, manual underwrite).

What counts as a 'monthly debt' for DTI?

Minimum payments on: credit cards (statement minimum, even if you pay in full), student loans (income-driven plan amount), auto loans, personal loans, alimony, child support, HOA dues, and any installment debt with >10 months remaining. Excluded: utilities, groceries, gas, savings, 401k contributions, taxes withheld from paycheck.

Does my credit score affect affordability?

Yes — indirectly through the interest rate you're offered. A 740+ credit score gets the best advertised rate; 680-739 adds ~0.25-0.5%; below 660 adds 0.75-1.25% (or denies you outright on conventional). On a $400K loan, the difference between 7.0% and 8.0% is $269/month — enough to drop your comfortable price by $40K. Pull both scores (FICO + VantageScore) at AnnualCreditReport.com before pre-approval.

Is a higher down payment 'better' for affordability?

It helps in three ways but isn't pure win. (1) Lower loan = lower monthly payment = better DTI fit. (2) 20%+ down avoids PMI ($100-300/month savings on a typical loan). (3) Lower LTV gets you the best rate tier. BUT — depleting savings to 0 to hit 20% leaves you exposed to first-year repair costs (HVAC ~$8K, roof ~$15K). Hold 3-6 months of housing costs in cash after closing.

What's the safest DTI to target?

For most buyers, target 28-32% back-end DTI (well below the 36% comfortable line). That gives you margin to absorb rate shocks if you refi later, child-care cost surprises, or a single-earner-household event. People who max out the 43% QM cap typically refinance, sell, or default within 5-7 years — the data backs the conservative target.

How accurate is this calculator vs. a real pre-approval?

Our number is a tight planning estimate within ±5% of a real pre-approval if your inputs match what the lender will verify. Lenders apply tighter rules: they cap your front-end at 28%, they require 2 years of W-2 history for self-employed buyers, and they DROP non-statutory bonus income from the income figure. Use this calculator to set your range; pre-approval refines it.

What if I have a co-borrower with no income but excellent credit?

Co-borrowers don't help affordability unless they contribute income. They CAN help if your credit is weak and they're strong — the lender uses the lower of the two median credit scores for rate. If neither income nor credit benefits, adding a co-borrower is unnecessary complexity.

Should I use the comfortable price or the stretch price?

Most personal-finance advisors point at comfortable. Real-estate professionals point at stretch (because their commission scales with price). Real answer: the right number is the one you can ALSO save 15% of income outside the mortgage at. If buying at stretch price means you can't save, you're house-poor and one job-change away from problems.

What if I make $200K but live in a high-cost area?

The 28/36 rule is income-based, not COL-adjusted. A $200K earner in San Francisco hits the same comfortable price as a $200K earner in Cleveland on this math. BUT — high-COL areas typically come with higher base expenses (childcare, taxes, food), so the 'comfortable' is more like 'survivable'. In HCOL markets, target 24% front-end DTI as a defensive buffer.

Does the calculator account for property tax and HOA?

Yes — the 'monthly tax + insurance' input subtracts from your housing budget before reverse-solving the max P&I. HOA dues should be added to that field. If you live in a high-property-tax state (NJ/IL/TX) and didn't enter realistic tax, the affordability number will be ~15-20% optimistic.

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Home Affordability Calculator — 28/36 Rule + DTI + Max Price (2026)

Drop your gross annual income, monthly debts, and the rate you're being quoted — get the home price that fits the 28/36 rule (Fannie Mae standard) plus the 43% QM stretch ceiling. Reverse-solves the max comfortable price, the stretch price, and shows DTI room remaining.

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Reviewed by CalcBold Editorial · Sources: CFPB Qualified Mortgage rule (12 CFR 1026.43) + Fannie Mae 28/36 rule + FHA debt-ratio guidelinesLast verified May 15, 2026Methodology

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What This Calculator Tells You

This is the lender-sideview of home affordability — what price tag a conventional mortgage lender will approve based on your gross income, monthly debts, and the rate you’re quoted. It applies the industry-standard 28/36 rule (Fannie Mae / Freddie Mac underwriting guideline) plus the 43% QM stretch ceilingdefined by the Consumer Financial Protection Bureau’s qualified-mortgage rule. The output tells you the maximum home price the lender will write you for — not necessarily the price you should actually pay.

The 28/36 Rule + the QM Ceiling

Mortgage lenders evaluate borrowers on two debt-to-income ratios:

Front-end ratio — monthly housing payment (PITI) divided by gross monthly income. The Fannie Mae conventional standard caps this at 28%.
Back-end ratio — PITI plus all other monthly debt obligations divided by gross monthly income. The conventional standard caps this at 36%.

The 43% QM ceilingis the regulatory maximum back-end ratio for a qualified mortgage under the CFPB’s 2014 ability-to-repay rule. Lenders rarely approve above 43% because non-QM loans lose the safe-harbour protection. Some portfolio lenders write up to 50% on strong-credit borrowers, but that’s the exception, not the rule.

The calculator reverse-solves both ratios: it computes the maximum monthly PITI you can carry at 28% (the comfortable price), 36% (the stretch), and 43% (the regulatory ceiling), and converts each to a home price using the rate and term you supply.

Why This vs the “Beyond DTI” Calculator?

Lenders only look at your gross income and your reported debts. They do not see your daycare costs, your retirement contributions, your maintenance reserve, your commuting expenses, or your savings goals. A lender approving you at the 43% QM ceiling will produce a number that’s often 30–40% higher than what your actual take-home budget can sustain comfortably.

If you want the lender’s view (what they’ll approve), this calculator is right. If you want the responsible-ownership view (what you should actually spend to avoid being house-poor), use the House Affordability Calculator (Beyond DTI) — it bakes in maintenance reserve, opportunity cost, and risk buffer.

How to Use This Calculator

Enter your gross annual income — pre-tax, before any deductions. Lenders look at gross, not net.
Enter your monthly debt payments — auto loans, credit-card minimums, student loans, child support, alimony. Do NOT include your future mortgage payment or rent.
Enter the interest ratefrom your lender’s loan estimate (use the APR if you have it; the note rate is the next-best input).
Enter the loan term (30 or 15 years).
Read the three price tiers: comfortable (28% front-end), stretch (36% back-end), regulatory max (43% QM). The middle number is what most lenders treat as “your max approval.”

Related Tools

Run the approved price through the mortgage calculator to see the full PITI payment with PMI, property tax, and insurance. Then sanity-check against the House Affordability (Beyond DTI) calculator to see if the lender-approved number is also a number you can actually afford to live with. Compare the monthly payment delta with the closing cost calculator to estimate the full cash-to-close figure.

Frequently Asked Questions

The most common questions we get about this calculator — each answer is kept under 60 words so you can scan.

What is the 28/36 rule?
The 28/36 rule is Fannie Mae's underwriting standard. 28% front-end: your total housing payment (PITI) should not exceed 28% of gross monthly income. 36% back-end: housing + ALL other monthly debt payments should not exceed 36% of gross monthly income. Loans that fit both constraints are routine; loans that exceed either typically require lender exception or higher down payment.
What's the difference between comfortable price and stretch price?
Comfortable price = the maximum home price that fits the 28/36 rule (Fannie Mae standard). Stretch price = the maximum that fits the 43% QM (Qualified Mortgage) cap — the federal regulatory ceiling under CFPB's ATR/QM rule. Lenders WILL underwrite up to 43% DTI, but you're operating at the edge — small income disruption (medical, layoff) creates immediate distress.
Why is DTI the most important number?
Because it's what lenders actually decision on. They don't care that you 'feel' you can afford it — they care that the math fits their underwriting box. CFPB's ATR rule (12 CFR 1026.43) makes the 43% DTI cap legally binding on most QM mortgages. Below 43% = easy approval. Above 43% = exception territory (jumbo, portfolio lender, manual underwrite).
What counts as a 'monthly debt' for DTI?
Minimum payments on: credit cards (statement minimum, even if you pay in full), student loans (income-driven plan amount), auto loans, personal loans, alimony, child support, HOA dues, and any installment debt with >10 months remaining. Excluded: utilities, groceries, gas, savings, 401k contributions, taxes withheld from paycheck.
Does my credit score affect affordability?
Yes — indirectly through the interest rate you're offered. A 740+ credit score gets the best advertised rate; 680-739 adds ~0.25-0.5%; below 660 adds 0.75-1.25% (or denies you outright on conventional). On a $400K loan, the difference between 7.0% and 8.0% is $269/month — enough to drop your comfortable price by $40K. Pull both scores (FICO + VantageScore) at AnnualCreditReport.com before pre-approval.
Is a higher down payment 'better' for affordability?
It helps in three ways but isn't pure win. (1) Lower loan = lower monthly payment = better DTI fit. (2) 20%+ down avoids PMI ($100-300/month savings on a typical loan). (3) Lower LTV gets you the best rate tier. BUT — depleting savings to 0 to hit 20% leaves you exposed to first-year repair costs (HVAC ~$8K, roof ~$15K). Hold 3-6 months of housing costs in cash after closing.
What's the safest DTI to target?
For most buyers, target 28-32% back-end DTI (well below the 36% comfortable line). That gives you margin to absorb rate shocks if you refi later, child-care cost surprises, or a single-earner-household event. People who max out the 43% QM cap typically refinance, sell, or default within 5-7 years — the data backs the conservative target.
How accurate is this calculator vs. a real pre-approval?
Our number is a tight planning estimate within ±5% of a real pre-approval if your inputs match what the lender will verify. Lenders apply tighter rules: they cap your front-end at 28%, they require 2 years of W-2 history for self-employed buyers, and they DROP non-statutory bonus income from the income figure. Use this calculator to set your range; pre-approval refines it.
What if I have a co-borrower with no income but excellent credit?
Co-borrowers don't help affordability unless they contribute income. They CAN help if your credit is weak and they're strong — the lender uses the lower of the two median credit scores for rate. If neither income nor credit benefits, adding a co-borrower is unnecessary complexity.
Should I use the comfortable price or the stretch price?
Most personal-finance advisors point at comfortable. Real-estate professionals point at stretch (because their commission scales with price). Real answer: the right number is the one you can ALSO save 15% of income outside the mortgage at. If buying at stretch price means you can't save, you're house-poor and one job-change away from problems.
What if I make $200K but live in a high-cost area?
The 28/36 rule is income-based, not COL-adjusted. A $200K earner in San Francisco hits the same comfortable price as a $200K earner in Cleveland on this math. BUT — high-COL areas typically come with higher base expenses (childcare, taxes, food), so the 'comfortable' is more like 'survivable'. In HCOL markets, target 24% front-end DTI as a defensive buffer.
Does the calculator account for property tax and HOA?
Yes — the 'monthly tax + insurance' input subtracts from your housing budget before reverse-solving the max P&I. HOA dues should be added to that field. If you live in a high-property-tax state (NJ/IL/TX) and didn't enter realistic tax, the affordability number will be ~15-20% optimistic.