How the maximum loan and price change with the debt-to-income limit applied.
DTI
Max payment
Max loan
Max price
28%
1,180
196,814
256,814
32%
1,420
236,844
296,844
36%
1,660
276,874
336,874
40%
1,900
316,904
376,904
Estimates only — not financial, tax, or professional advice.
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What it calculates: Maximum Loan Amount, Maximum Property Price, Maximum Monthly Payment, Payment as % of Income.
Updated 5 June 2026 · Transparent assumptions
36% of $6,000 is $2,160, less $500 of debts, leaves $1,660 for housing
A 36% DTI limit on $6,000 of monthly income allows $2,160 of total debt payments. Existing debts of $500 leave $1,660 for the mortgage. At 6% over 30 years, $1,660 a month services a loan of about $276,874, and adding a $60,000 deposit gives a maximum purchase price of $336,874.
Every step is a lender rule rather than a law of arithmetic, which is why the same household gets different answers from different lenders. The DTI limit, whether taxes and insurance are counted inside the housing payment, and how existing debts are treated all vary, and each moves the ceiling by tens of thousands.
$500 a month of payments costs about $83,000 of borrowing power
The $500 of monthly debt payments reduces the housing allowance by exactly $500, which at these terms is around $83,000 of loan. Paying off a car loan with $6,000 outstanding and a $500 payment therefore raises the purchase ceiling by roughly $83,000 — fourteen times what it cost to clear.
This is the highest-leverage action available to most buyers before applying, and it works because DTI counts payments rather than balances. A large balance with a small payment barely matters; a small balance with a large payment matters enormously. Clear the highest payment relative to its balance first.
A point of rate is worth tens of thousands of purchase price
At $1,660 a month the loan supported is about $276,900 at 6%, roughly $249,000 at 7%, and about $306,000 at 5%. A single percentage point moves borrowing power by 10% or more, with no change to income, deposit or debts.
That is why pre-approval has a shelf life and why buyers shopping across a moving rate environment can find the same salary buying a materially different house within months. It is also the argument for checking the ceiling at a rate above today\u2019s before committing to a search at the top of the range.
The most you can borrow is rarely the most you should
A lender\u2019s maximum is the point at which they are comfortable, computed from gross income and excluding almost everything a household actually spends — childcare, commuting, saving, food, and the cost of running a larger home than the one you have.
The calculation also excludes property tax, insurance and any HOA dues unless they were entered in the housing figure, and most lenders count all of them inside the ratio. A ceiling computed on principal and interest alone will overstate what an underwriter will actually approve, often by a wide margin.
Sources & References
Figures on this page are checked against primary, authoritative sources. Links open in a new tab.
Results are estimates based on the figures you enter and standard formulas. Rates, fees, taxes, and lender terms vary and change over time, so confirm important numbers with your lender or a qualified professional. This is educational information, not financial advice.
Published the calculator with its formula, worked example, assumptions, limitations and a bespoke guide, and added an automated formula test suite covering it.
Tested that existing debts reduce the housing allowance dollar for dollar, and that the maximum price is the maximum loan plus the deposit.
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