Buying a home is the biggest financial decision most people make. But before you fall in love with a property, you need to know what you can actually afford — not just what a lender will give you.
Quick answer: Most US lenders cap your mortgage at 28% of gross monthly income. UK lenders typically offer 4–4.5x your annual salary. But what you can borrow and what you should borrow are often very different.
US mortgage lenders use the 28/36 rule:
| Annual Income | Max Monthly Mortgage (28%) | Estimated Home Price |
|---|---|---|
| $60,000 | $1,400 | ~$220,000 |
| $80,000 | $1,867 | ~$295,000 |
| $100,000 | $2,333 | ~$370,000 |
| $150,000 | $3,500 | ~$555,000 |
Estimates based on 7% interest rate, 30-year term, 20% down payment.
UK lenders typically offer 4 to 4.5 times your annual income. Joint applications use combined income.
| Annual Income | At 4x | At 4.5x |
|---|---|---|
| £30,000 | £120,000 | £135,000 |
| £50,000 | £200,000 | £225,000 |
| £70,000 | £280,000 | £315,000 |
| £100,000 | £400,000 | £450,000 |
The purchase price is just the start. Budget for:
1. Your debt-to-income ratio — add up all monthly debt payments, divide by gross monthly income. Keep below 36% (US) or 40% (UK).
2. Your deposit/down payment — US: 20% avoids PMI. UK: 10% gets you decent rates; 5% is minimum for most schemes.
3. Your monthly payment comfort — the bank says you can afford it, but can you sleep at night? Factor in job security and future plans.
Calculate your exact monthly payments, total interest, and see your full amortization schedule.
🏠 Use the Mortgage CalculatorLenders will often offer you more than you should borrow. A good rule of thumb: keep your mortgage at no more than 3x your annual income for financial comfort, even if you qualify for 4.5x. The difference in monthly payment is worth the breathing room.
Also check your take-home pay to see what you actually have available each month.
💰 Take-Home Pay Calculator