The true cost of a home is the full monthly payment, not just principal and interest. Estimate PITI, PMI and HOA dues, test front-end and back-end debt-to-income ratios, and find the maximum price your income supports under the 28/36 guideline.
How it works
Estimate the full monthly housing payment, test debt-to-income ratios, and find the maximum home price under the 28/36 guideline.
Principal & interest = Loan × r ÷ (1 − (1 + r)^−n), r = rate ÷ 12
PITI = P&I + Tax ÷ 12 + Insurance ÷ 12 + HOA + PMI
Front-end DTI = PITI ÷ Gross monthly income
Back-end DTI = (PITI + Other debts) ÷ Gross monthly incomeCommon uses
- Home purchase budgeting
- Comparing down payment and term options
- Pre-qualification readiness
Worked example
The calculator above opens with this example. Change any input to see the results update instantly, or select Reset to return to these figures.
| Home price | $425,000 |
| Down payment | 15% |
| Interest rate | 6.75% |
| Loan term | 30 years |
| Property tax (annual) | $4,800 |
| Homeowners insurance (annual) | $1,800 |
| HOA dues (monthly) | $0 |
| PMI rate (annual, if < 20% down) | 0.55% |
| Gross monthly income | $11,500 |
| Other monthly debt payments | $650 |
| Total monthly payment | $3,058.63 |
| Principal & interest | $2,343.06 |
| Taxes, insurance & HOA | $550.00 |
| PMI | $165.57 |
| Front-end DTI (housing) | 26.6% |
| Back-end DTI (total) | 32.2% |
| Loan amount | $361,250 |
| Max price at 28/36 | $448,578 |
The 28/36 rule is a conventional guideline; lender limits vary by loan program (FHA and VA allow higher ratios). Maximum price holds the down-payment percentage and property-tax rate constant.
Interpreting the results
- Keep housing costs at or below 28% of gross income and total debt at or below 36% for a conservative budget.
- PMI typically ends once the loan reaches 78–80% of the original home value.
Frequently asked questions
What is the 28/36 rule?
The 28/36 guideline suggests housing costs should not exceed 28% of gross monthly income, and total debt payments should not exceed 36%. Lenders’ actual limits vary by loan program and borrower profile.
When is private mortgage insurance required?
PMI is generally required on conventional loans with less than 20% down. It can typically be removed once the loan balance falls to 80% of the home’s original value, and is cancelled automatically at 78%.
What is included in the total monthly payment?
The estimate includes principal and interest, property taxes, homeowners insurance, HOA dues and PMI where applicable. Maintenance, utilities and repairs are not included and should be budgeted separately.
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