The 28/36 rule is the most widely used affordability guideline in U.S. mortgage lending: housing costs at or below 28% of gross monthly income, total debt (housing plus everything else) at or below 36%. It's not the only rule of thumb in circulation, though — and comparing it against the alternatives clarifies what each one actually optimizes for.
This page runs all four common rules — 28/36, the conservative 25/33 band, the 3-3-3 rule, and the simple 3x-income multiple — against the same household, so you can see exactly where they agree and where they diverge, and why.
28/36 vs the conservative 25/33 band
25/33 is simply a tighter version of the same two-ratio framework — 3 percentage points lower on each cap. The difference in practice is real: on a $100,000 income, the gap between 28% and 25% front-end is about $250 a month in housing budget, which compounds into $40,000–$50,000 of home-price difference over a 30-year loan. Financial planners frequently recommend the conservative band specifically for households that want a cushion against rate resets, income disruption, or simply prefer more discretionary income alongside the mortgage.
This calculator's comfort-band verdict is built on exactly this comparison: a result that clears the conservative 25/33 caps is flagged "comfortable," one that only clears the standard 28/36 caps is flagged "at your limit," so you can see at a glance which side of that gap your own numbers fall on.
The 3-3-3 rule and the 3x-income shortcut
The 3-3-3 rule is a simpler, non-ratio-based heuristic: save at least 3 months of gross income for a down payment, keep the mortgage payment at or below roughly 3 weeks of monthly income (close to 25% of gross monthly income — similar in spirit to the conservative front-end cap), and hold 3 months of expenses in reserve after closing. It trades precision for memorability — useful as a gut-check, less useful for solving your exact max price.
The 3x-income multiple (sometimes stated as 2.5x to 4x depending on the source) is the crudest of the four: multiply annual gross income by a flat factor to estimate affordable home price. It ignores rate, debt, down payment, and local tax/insurance costs entirely, which is why it can be wildly wrong in either direction — understating affordability for a debt-free high earner with a large down payment, and badly overstating it for someone carrying significant other debt. The DTI-based rules above all account for these factors directly; the income multiple does not.
Frequently asked questions
What is the 28/36 rule?
Housing costs (principal, interest, taxes, insurance, PMI/HOA) at or below 28% of gross monthly income, and total debt including housing at or below 36%. It's the standard conventional-loan affordability guideline used by most U.S. mortgage lenders.
What is the 3-3-3 rule for buying a house?
Save 3 months of gross income as a down payment, keep the mortgage payment at or below roughly 3 weeks of monthly income, and keep 3 months of expenses in reserve after closing. It's a simpler, memorable alternative to the formal 28/36 DTI framework, though less precise.
What is the 7% rule in home buying?
There's no single standardized "7% rule" in mainstream affordability guidance — it's sometimes used informally to describe total housing costs (including maintenance and utilities, not just PITI) staying below 7% of gross income for renters comparing to ownership costs, or as a rough mortgage-rate reference point. Treat it as a loose heuristic, not a formal lending standard like 28/36.
Is the 3x income rule accurate for home affordability?
Rarely, on its own. It ignores interest rate, other debt, down payment size, and local property tax and insurance costs — all of which meaningfully shift true affordability. Two households with identical income can have very different real affordability depending on these factors, which is why DTI-based calculations (28/36 or stricter) are more reliable than a flat income multiple.
Which affordability rule should I actually use?
For a precise number, use the full DTI-based calculation (28/36 or the conservative 25/33) against your real income, debt, rate, and down payment — that's what the calculator on this site does. Use the 3-3-3 rule or 3x-income multiple only as a rough sanity check, not as your final number.
Worked examples
Worked example 1
Standard 28/36 vs conservative 25/33, same household
$100,000 income, $500/mo other debts, $40,000 down, 6.5% rate — standard caps.
Max home price
$320,673
Binding constraint
front
PMI
$140/mo
Standard 28/36 caps land at $320,673 — comfort band: standard.
Worked example 2
The same household under the conservative 25/33 band
$100,000 income, $500/mo other debts, $40,000 down, 6.5% rate — conservative caps.
Max home price
$288,362
Binding constraint
front
PMI
$124/mo
Conservative 25/33 caps land at $288,362 — comfort band: comfortable, trading price for monthly breathing room.
What affects the result
Which rule you apply
Standard 28/36, conservative 25/33, and the 3-3-3 rule all give meaningfully different numbers for the identical household.
The 3x-income shortcut ignores debt and rate entirely
Unlike the DTI-based rules, a flat income multiple can't distinguish a debt-free high earner from someone carrying significant other debt.
More questions answered
Which rule do mortgage lenders actually use — 28/36 or something else?
Conventional lenders typically use 28/36 as the standard guideline, with automated underwriting systems approving exceptions above that for strong applicants. FHA uses 31/43. The conservative 25/33 band and rules like 3-3-3 are personal-finance heuristics, not lender standards.
Model assumptions & disclosures
Not a pre-approval. This calculator estimates your maximum home price using standard debt-to-income (DTI) caps against the income, debts, rate, and down payment you enter. It does not verify income, assets, credit, or employment, and it is not an offer or commitment from any lender. Actual mortgage pre-approval requires full lender verification and may differ from this estimate.
DTI caps are lender-dependent. The 28/36 (conventional) and 31/43 (FHA) caps used as defaults are common industry guidelines, not universal rules. Individual lenders, loan programs, and automated underwriting systems can approve — or require — different ratios based on credit score, cash reserves, loan-to-value, and other compensating factors not modeled here.
Rate, tax, insurance, and PMI are your estimates, not live data. This calculator never fetches a current mortgage rate, your actual local property tax rate, or a real insurance quote. Defaults are reasonable national approximations — enter your own numbers, or figures a lender or insurer has actually quoted you, for an accurate result.
Credit score is not modeled. Your interest rate — which directly drives your monthly payment and therefore your DTI — depends on your credit score and the specific loan program. This calculator assumes whatever rate you enter; it does not estimate what rate you would actually qualify for.
Not financial or legal advice. This calculator provides illustrative estimates based on your inputs. It does not account for your complete financial picture, local market conditions, or individual circumstances. Consult a qualified mortgage lender, financial advisor, or housing counselor before making a home-purchase decision.