Real Estate & Mortgages

Basic

Affordability (28% Rule)

Recommended maximum housing payment from gross income.

Formula

M_{max} = 0.28 \times I

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Variables

M_{max}Max monthly payment

IGross monthly income

Example

Income $8000/mo: M_max = $2240

Did You Know?

The classic 28/36 rule caps housing at 28% of income and all debts at 36% — a lender's rule of thumb.

real estate affordability budget

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