How Much House Can I Afford? The 28/36 Rule Explained
The lending rule that decides your budget, what lenders check beyond it, and why the bank may approve more than you should spend.
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See your full monthly principal-and-interest payment — and what the loan really costs over its lifetime.
$
$
20.0% of the home price
6.5%
30 years
Monthly Payment (P&I)
$2,022.62
Loan Amount$320,000
Total Interest$408,142
Total Cost of Home$808,142
Principal and interest only. Property taxes, homeowners insurance, PMI, and HOA dues are not included.
How your monthly payment is calculated
This calculator uses the standard fixed-rate amortization formula: your loan amount (home price minus down payment), your annual interest rate divided into monthly periods, and the total number of payments in your term. Early payments are mostly interest; over time the balance shifts toward principal.
The result covers principal and interest only. Your actual monthly housing cost also includes property taxes — estimate those with the Property Tax Calculator — plus homeowners insurance, and possibly PMI or HOA dues.
Three ways to lower your payment
A larger down payment shrinks the loan directly, and crossing 20% typically removes PMI. A lower rate matters more than most buyers expect — even 0.5% changes the payment meaningfully, so compare at least three lenders. A longer term lowers the monthly figure but raises lifetime interest; drag the term slider above and watch the “Total Interest” line to see the trade-off. Not sure what price range to test? Start with the Affordability Calculator.
Mortgage calculators by state
Property taxes and home prices vary by state — these versions pre-fill local medians:
Frequently asked questions
What does the monthly payment include?
This calculator shows principal and interest only. Your full monthly housing cost (often called PITI) also includes property taxes, homeowners insurance, and possibly PMI or HOA dues.
How does the loan term affect total cost?
A shorter term means higher monthly payments but far less interest over the life of the loan. A 15-year loan can cut lifetime interest by more than half compared to a 30-year loan at the same rate.
What interest rate should I enter?
Use the rate you have been quoted by a lender, or the current average rate for your loan type and credit range as a starting point. Even a 0.5% difference meaningfully changes your monthly payment.
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