Question 1

How much house can I afford on a $80,000 salary?

Accepted Answer

A general rule is that your monthly housing payment should not exceed 28% of your gross monthly income. On an $80,000 salary, that's about $1,867/month. Depending on your debts and down payment, this typically translates to a home price of $250,000–$320,000 at current interest rates.

Question 2

What is the 28/36 rule for mortgages?

Accepted Answer

The 28/36 rule says your monthly housing costs shouldn't exceed 28% of gross income, and your total debt payments (housing + car loans + student loans + credit cards) shouldn't exceed 36%. Lenders use this as a guideline, though some loan programs allow higher ratios.

Question 3

How does my debt-to-income ratio affect how much I can borrow?

Accepted Answer

Your DTI (debt-to-income ratio) is one of the most important factors lenders look at. Most conventional loans allow a maximum DTI of 43–45%. FHA loans can go up to 57% in some cases. The lower your DTI, the more home you qualify for.

Question 4

Does the down payment amount affect affordability?

Accepted Answer

Yes, significantly. A larger down payment reduces your loan amount, which lowers your monthly payment. It can also eliminate PMI (required on conventional loans below 20% down), saving $100–$300/month on a typical loan.

Question 5

Should I get pre-approved before house hunting?

Accepted Answer

Yes. A pre-approval letter shows sellers you're a serious buyer and gives you a firm budget to work with. As an independent broker, we can pre-approve you quickly and shop dozens of lenders to make sure you're getting the most competitive rate available.

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Home Affordability Calculator

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