How Much House Can I Afford on $120k Income?
Calculate the maximum home price on a $120,000 annual income with $600 monthly debt, $50,000 down, and a 6.5% interest rate.
How to use this tool
- Enter your gross (pre-tax) monthly income for all borrowers.
- Add up your other monthly debt payments (cars, student loans, card minimums).
- Enter your planned down payment, expected rate, and loan term.
- Adjust the front/back ratios if you want a more or less conservative budget.
- Read the maximum home price, loan amount, and monthly payment budget.
Estimate the most expensive home you can buy on a $120,000 gross annual income with $600 in monthly debts and a $50,000 down payment.
Frequently asked questions
- How much house can I afford on my salary?
- A common rule of thumb is that your home price can be 3–5x your gross annual income, but the precise answer depends on your other debts, down payment, interest rate, and loan term. This calculator computes it from the 28/36 lender ratios rather than a flat multiple.
- What is the 28/36 rule?
- Spend no more than 28% of gross monthly income on housing (front-end ratio) and no more than 36% on total debt including the mortgage (back-end ratio). It is the traditional affordability guideline used by underwriters.
- Does this include taxes and insurance?
- No — the result is principal and interest only. Property taxes, homeowners insurance, PMI, and HOA dues also count toward the housing ratio, so your true affordable loan is somewhat lower. Budget for those escrow costs.