Do You Know How Much House You Can Afford?

August 31, 2026

Admin

A person kneels smiling among moving boxes in a bright, nearly empty room

You know what’s fun & exciting? Shopping for your first home.You know what’s not as glamorous? Figuring out your finances and choosing a home that fits within your budget. It’s easy to get swept up in the search for perfection. But a home that fits within budget—a home that allows you to live comfortably and without daily financial stress—is truly a dream home. So, before you start curb shopping, let’s figure out how much house you can afford.

The 28/36 Rule
As a general guideline, it’s recommended you spend no more than 28% of your monthly gross income on your mortgage payment. (Your mortgage payment is made up of principal, interest, taxes, and insurance.)

Debt-To-Income Ratio
Another guideline to keep in mind is the 36% rule, which suggests 36% be the maximum percentage of gross monthly income you spend on all of your debt, including housing. (This is also known as your debt-to-income ratio.)

Use Centreville Bank’s mortgage loan calculator to help you figure out the numbers, including a loan amount that fits your budget, and total interest you would pay over the life of the loan.

Now let’s do your numbers:

For starters, calculate how much you (and your partner/co-borrower if that applies) earn each month, including job income, alimony, investment profits, rental earnings, etc.
Next, calculate your estimated housing costs and your total down payment. Include annual property tax, homeowner’s insurance, estimated mortgage interest rate and the loan terms (or how long you want to pay off your mortgage).
Finally, calculate your expenses. This is all the money that goes out on a monthly basis. Be as accurate as possible.

Your lender will help you determine what you can comfortably afford and ensure that the final number fits well within budget and aligns with your goals. By shopping wisely and working with a lender who cares about your success, you can truly enjoy home sweet home.

Contact A Loan Officer