How much house can I afford on $60,000 a year with $500 of monthly debt and $20,000 down?
$162,390
On $60,000 a year with $500 a month of other debt, the 28/36 rule supports about $1,300 a month of housing cost — roughly a $162,390 house with $20,000 down at 6.5% over 30 years.
How it is worked out
Lenders cap two ratios: housing alone at about 28% of gross income, and housing plus every other debt at about 36%. The lower of the two binds. The 36% total-debt limit is what binds here, not the 28% housing one — so every $100 a month of that $500 you clear raises the housing budget by the same $100.
min($5,000 × 28%, $5,000 × 36% − $500) = $1,300 housing; less $400 tax and insurance leaves $900 for principal and interest, which supports a $142,390 loan
This is what a lender would approve, which is not the same as what is comfortable to live on — the ratios use gross income, so they are drawn on money you never receive. Tax and insurance are assumed at $400 a month and vary enormously by location; HOA fees, PMI below 20% down, and maintenance are all on top.
Open the full house affordability calculator to use your own figures.
Similar questions
- $40,000/yr = $84,379
- $40,000/yr · $20,000 down = $104,379
- $40,000/yr · $50,000 down = $134,379
- $40,000/yr · $100,000 down = $184,379
- $40,000/yr · $300 debt = $79,105
- $40,000/yr · $300 debt · $20,000 down = $99,105
Questions
- How much house can I afford on $60,000 a year with $500 of monthly debt and $20,000 down?
- On $60,000 a year with $500 a month of other debt, the 28/36 rule supports about $1,300 a month of housing cost — roughly a $162,390 house with $20,000 down at 6.5% over 30 years. min($5,000 × 28%, $5,000 × 36% − $500) = $1,300 housing; less $400 tax and insurance leaves $900 for principal and interest, which supports a $142,390 loan.
- How is this worked out?
- Lenders cap two ratios: housing alone at about 28% of gross income, and housing plus every other debt at about 36%. The lower of the two binds. The 36% total-debt limit is what binds here, not the 28% housing one — so every $100 a month of that $500 you clear raises the housing budget by the same $100.
- Can I use my own figures?
- Yes — the house affordability calculator takes any values and shows the full result.