The 28/36 Rule

The 28/36 rule is a quick affordability test built into how lenders think. The first number, 28, is the front-end ratio: your total monthly housing payment, including principal, interest, taxes, and insurance, should stay at or below 28 percent of your gross monthly income. The second number, 36, is the back-end ratio: all of your monthly debt payments together, housing plus car loans, student loans, and credit card minimums, should stay at or below 36 percent.

The rule is a guideline, not a law, and lenders approve higher ratios when other parts of your file are strong, such as a large down payment or excellent credit. It uses gross income, so it does not account for taxes, retirement savings, or your actual lifestyle, which means a payment that fits the rule can still feel tight. Our home affordability calculator applies these limits to estimate a price range from your income and existing debts. For the full plain-English breakdown, with the rule turned into real monthly dollars and an honest look at why lenders go past it, see the playbook The 28/36 Rule Explained Without the Bank-Speak.