How much home can I afford on $70,000 a year?

Question

Accepted Answer

If you make $70,000 per year, that translates to a gross monthly income of $5,833.33. Using the 28% rule of thumb, you should have a mortgage, property tax and insurance payment of no more than $1,633. Assuming taxes and insurance cost $433 a month, that leaves $1,200 to use for mortgage principal and interest, which at 7% interest means you can borrow just over $180,000 to buy a home.