- US lenders typically cap housing costs at 28% of gross income and total debt at 36% — whichever is more restrictive sets your max mortgage.
- This is an estimate, not a pre-approval — actual approval also depends on credit score and lender-specific overlays.
- Existing monthly debt (car loans, student loans, credit cards) directly reduces how much house you can afford.
- Hunch connects your real income and debts so this estimate updates automatically as your finances change.
How the home affordability calculator works
Enter your gross income, existing monthly debt payments, and down payment. The calculator applies standard front-end (housing) and back-end (total debt) ratios to find the maximum monthly payment a lender would typically allow, then converts that into a maximum home price.
The math: front-end and back-end DTI ratios
Front-end DTI caps housing costs (principal, interest, taxes, insurance) at 28% of gross monthly income. Back-end DTI caps total debt payments — housing plus all other debt — at 36% of gross monthly income. The calculator takes whichever ratio is more restrictive given your existing debt, then works backward from the resulting maximum payment to a maximum home price at your assumed rate and term.
Worked example
On $8,000/month gross income with $400/month in existing debt and a $40,000 down payment: the 28% front-end cap allows a $2,240 housing payment, but the 36% back-end cap only leaves $2,480 minus the $400 existing debt = $2,480 available — so front-end is the binding constraint at $2,240/month, translating to roughly a $410,000 maximum home price at a typical rate.
Key terms
- Front-end DTI
- Housing costs (mortgage principal, interest, taxes, insurance) as a percentage of gross monthly income — typically capped around 28%.
- Back-end DTI
- All monthly debt payments, including housing, as a percentage of gross monthly income — typically capped around 36%.
- Gross income
- Income before taxes and deductions — the figure lenders use for affordability ratios.
- Pre-approval
- A lender's formal, documented commitment to lend up to a certain amount, based on a full application — more reliable than a general affordability estimate.