What income do I need to buy a $400,000 house?

Using the 28/36 rule with 20% down and current rates, you'd typically need around $100,000-$120,000 annual income to comfortably afford a $400,000 home, depending on your other debts.

How do lenders calculate affordability?

Lenders use debt-to-income (DTI) ratios. Front-end DTI measures housing costs vs income (typically max 28-31%). Back-end DTI includes all debts (typically max 36-43%). FHA and VA loans often allow higher ratios.

How Much House Can I Afford?

Calculate your maximum home price based on income, debts, and down payment. See what you can afford with different loan types and DTI scenarios.

Your Financial Profile

💰 Income

Annual Gross Income

Before taxes. Include all W-2 and documented income.

📋 Monthly Debts

Total Monthly Debt Payments

Car loans, student loans, credit card minimums, etc.

🏦 Down Payment

Available Down Payment

Or as Percentage

Down payment adjusts as home price changes

📊 Loan Assumptions

Interest Rate

Loan Term

Property Tax Rate

Annual rate (varies by location)

Homeowner's Insurance

Annual premium estimate

Include HOA fees

Your Maximum Home Price

$250,000

Based on 28/36 DTI guidelines

Budget Scenarios

🛡️ Conservative

$200,000

$1,400/mo

25% DTI

✓ Standard

$250,000

$1,750/mo

28% DTI

Recommended

⚡ Stretch

$300,000

$2,100/mo

33% DTI

Monthly Payment Breakdown

Total Payment $1,750

Principal & Interest $1,298

Property Tax $250

Insurance $125

PMI $77

HOA $300

By Loan Type

Loan Type	Max Home Price	Down Payment	Payment
Conventional 28/36 DTI	$250,000	$50,000 (20%)	$1,750
FHA 31/43 DTI, 3.5% min	$290,000	$10,150 (3.5%)	$2,150
VA 41% back-end DTI	$320,000	$0 (0%)	$2,350

* Actual limits depend on loan limits, credit score, and lender requirements.

What Income Do I Need?

Income required to afford different home prices at your current rate and debts:

$300,000

$85,000

$400,000

$110,000

$500,000

$135,000

$600,000

$160,000

How We Calculate Affordability

The 28/36 Rule

Most lenders use the 28/36 rule as a guideline:

28% Front-End DTI: Your housing payment (PITI) should not exceed 28% of gross monthly income
36% Back-End DTI: Total debt payments (housing + other debts) should not exceed 36%

Our calculator uses the more restrictive of these two limits to determine your maximum affordable home price.

PITI Components

Your monthly housing payment includes:

Principal: Amount going toward loan balance
Interest: Cost of borrowing
Taxes: Property taxes (varies by location)
Insurance: Homeowner's insurance + PMI if applicable

PMI is automatically added when down payment is less than 20%.

Loan Type Differences

Different loan programs have different DTI limits:

Conventional: 28% front / 36% back (up to 43-45% with compensating factors)
FHA: 31% front / 43% back (can be higher with reserves)
VA: No front-end limit / 41% back-end (residual income is key)

Important Considerations

This calculator provides estimates based on DTI guidelines. Actual approval depends on:

Credit score and history
Employment stability (2+ years)
Cash reserves after closing
Loan-to-value ratio
Local conforming loan limits

Check Your DTI Ratio

Use our DTI calculator to see exactly where you stand against lender guidelines.

Open DTI Calculator

Disclaimer: This calculator provides estimates for educational purposes only. Actual mortgage approval and terms depend on credit score, employment history, and lender requirements. Consult with a mortgage professional for personalized advice.