Most calculators will tell you the mortgage payment on a given loan amount. Almost none of them tell you what that payment should be for your income, which is the question that actually matters before you start house hunting.
There are two widely used answers, one based on your gross (pre-tax) income, one based on your take-home pay, and they land in different places. Below is both, plus a worked example on a real salary so you can see exactly where the numbers come from.
What Percentage of Your Income Should Go to Your Mortgage?
Lenders and financial planners generally cite one of three guidelines, and they don't all mean the same thing. Here's how they compare:
| Rule | What It Caps | Typical Limit |
|---|---|---|
| 28/36 Rule | Housing / Total debt | 28% gross / 36% gross |
| 35/45 Rule | Housing / Total debt | 35% gross / 45% gross |
| 25% Post-Tax Rule | Housing only | 25% take-home pay |
The 28/36 rule is the most widely cited version and the one most conventional lenders still underwrite around. The 35/45 rule is looser and shows up more in what borrowers can qualify for, not necessarily what they should comfortably spend. The 25% take-home rule is the most conservative of the three because it applies to a smaller number (after-tax income) in the first place.
What's Actually Included in Your Monthly Mortgage Payment?
Before running any percentage against your income, it helps to know what "mortgage payment" actually covers. Lenders use the acronym PITI:
- Principal: pays down the loan balance
- Interest: the lender's cost for the loan
- Together, this is the number most calculators show
- Property taxes, usually escrowed monthly
- Homeowners insurance, also typically escrowed
- PMI if your down payment is under 20%
- HOA fees, budgeted separately but still part of your real housing cost
This is where a lot of affordability guidance goes wrong: the percentage rules above are meant to apply to your full PITI payment, not just principal and interest. Skipping taxes and insurance in your math can make a house look 15-20% more affordable than it actually is.
How Much House Payment Can You Afford on Your Salary?
Here's the 28/36 rule and the 25% take-home rule run against a real number: a $75,000 gross annual salary.
| Metric | 28/36 Rule (Gross) | 25% Rule (Take-Home) |
|---|---|---|
| Monthly Income Used | $6,250 gross | ~$4,875 take-home |
| Housing Payment Cap | $1,750 (28%) | ~$1,220 (25%) |
| Total Debt Cap | $2,250 (36%) | Not defined by this rule |
On this salary, the gap between the two guidelines is about $530 a month. Neither number is "wrong," they're answering slightly different questions: the 28/36 rule reflects roughly what a lender is comfortable approving, while the 25% take-home rule reflects what usually leaves more comfortable room in a monthly budget after taxes, retirement contributions, and other costs come out.
Run this against your own income
Enter your salary and see your exact 28/36 and take-home payment caps, plus the loan amount they support.
28/36 Rule vs. 25% Take-Home Rule: Which Should You Use?
Both are legitimate starting points, but they fit different situations.
- You have little to no other monthly debt (car, student loans, credit cards)
- Your income is stable and predictable (salaried, single earner or dual income)
- You're comparing against what a lender will likely approve
- You have variable income, freelance, commission, or bonus-heavy pay
- You're already carrying other debt payments
- You want a bigger monthly cushion for savings, emergencies, or lifestyle costs
Approval and comfort aren't the same thing. A lender qualifying you at 28% gross doesn't mean that payment will feel easy once taxes, retirement contributions, and everyday costs come out of your paycheck. If you're also weighing how big a loan that payment actually supports, our how much house can I afford breakdown walks through the down payment and DTI side of that question.
What Changes Your "Should Be" Number
The percentages above are a starting point, not a fixed rule. A few factors shift where your real number should land:
- Existing debt: Car payments, student loans, and credit card minimums all eat into the 36% total-debt cap, leaving less room for housing.
- Down payment size: A larger down payment lowers your loan amount and can remove PMI, both of which shrink your monthly payment for the same purchase price.
- Property taxes and HOA fees: These vary heavily by location and can add hundreds of dollars a month that a simple principal-and-interest estimate won't capture.
- Income stability: Two dual-income earners with steady salaries can often comfortably run closer to 30-33%, while a single or variable income is usually safer sticking closer to 25%.