💼 Your Income & Debts
🏦 Loan Details
✅ Your Home Buying Power
📊 Your 3 Budget Scenarios
📏 Debt-to-Income Ratio (DTI)
Want to estimate your take-home pay first?
💰 Open PayCalc Pro →💸 Free Down Payment Help
Most first-time buyers don't know this: all 50 states offer down-payment assistance, often $5,000–$25,000+. You may qualify even with average credit.
See the checklist step →📈 2026 Mortgage Rates
No more than 28% of your gross monthly income should go to housing. No more than 36% to ALL debt combined. These are the two numbers lenders use to approve or deny your mortgage.
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📖 Maryland Money Guides
🧮 Worked Example
A single buyer earns $85,000/year in ZIP 20850 (Rockville, MD), has a $350/month car payment, no other debt, plans 10% down, and qualifies for a 6.65% 30-year conventional rate.
- Monthly gross income: $7,083. 28% housing cap: $1,983/month. 36% total-debt cap minus the $350 car payment: $2,200/month.
- The lower (safer) number, $1,983/month, is what the calculator uses for the "Safe" scenario.
- After backing out an estimated $1.10/$100 property tax rate, insurance, and PMI (since 10% down is under 20%), that monthly budget supports a home price in roughly the $300,000–$330,000 range — not the $500,000+ that "just multiply salary by 4" rules of thumb often suggest.
Change any input above — income, ZIP, down payment, or existing debt — and the three scenarios (Safe / Stretching / Max) update instantly with your real numbers.
⚠️ Limitations
This tool estimates property tax and median home price from your ZIP code's first digit, which is a rough regional average — not your exact county or city rate. It doesn't know your actual credit report, existing savings for closing costs, HOA special assessments, flood insurance requirements, or a lender's specific overlays (extra requirements some lenders add beyond standard guidelines). It also can't see local Maryland transfer and recordation taxes, which add to your closing costs and aren't part of the monthly payment shown here. Treat the result as a starting budget range, not a number to bring to a seller.
🚫 Common Mistakes
- Using gross salary instead of take-home pay to picture monthly cash flow. The 28/36 rule uses gross income for the ratio, but your actual bank balance is driven by take-home pay — check both.
- Forgetting closing costs. Budgeting only for the down payment and getting surprised by another ~3% of the price due at closing.
- Ignoring PMI when comparing down payment sizes. A lower down payment can mean a materially higher total monthly cost once PMI is added — the calculator factors this in automatically.
- Shopping for a house before getting pre-approved. Sellers and agents take offers less seriously without a real pre-approval letter, and you risk falling for a home outside your real budget.
❓ Frequently Asked Questions
It's the ratio lenders use to size your max mortgage. 28% is the most your monthly housing payment (principal, interest, taxes, insurance, and HOA) should be as a share of your gross monthly income. 36% is the cap on ALL debt combined — housing plus car loans, student loans, credit cards, etc. This calculator uses both limits, then shows you the lower (safer) number.
Your ZIP code sets the estimated property tax rate used in the affordability math, since property tax varies a lot by county — it can swing your monthly payment by hundreds of dollars. It's still an estimate; your county assessor's office has the exact current rate for your specific address.
The rates shown are general market averages for conventional, FHA, and VA loans, used as a default starting point. Your actual rate depends on your credit score, down payment, loan type, and lender — always get a real quote before treating this as final.
Yes. If your down payment is under 20%, the calculator factors in estimated PMI (private mortgage insurance), plus estimated homeowner's insurance and property tax, so the affordability number reflects your real monthly housing cost — not just principal and interest.
No. This is a free estimate based on the numbers you type in. A real pre-approval comes from a licensed lender who pulls your credit and verifies your income and debts. Use this tool to get a ballpark before you talk to a lender, not instead of it.