How We Calculate
Our affordability verdicts are based on established lending standards and publicly available financial data. Here's exactly how each calculation works.
We apply 2026 federal tax brackets based on your filing status, then estimate state taxes using your location's ZIP code. FICA (Social Security 6.2% + Medicare 1.45%) is deducted from gross. The result is your estimated net monthly income — the number that actually matters for affordability.
Per Fannie Mae Qualified Mortgage standards, total housing costs (mortgage P&I + property tax + insurance + PMI) should not exceed 28% of net monthly income. We calculate all-in housing cost including estimated property taxes based on your location and home price.
Debt Burden (DTI) combines housing costs with all monthly debt obligations (car payments, student loans, other recurring debt). CFPB Qualified Mortgage rules set 43% as the maximum, but most financial planners recommend staying below 36% for financial flexibility.
SAFE: Housing ratio ≤ 28% of net income and DTI ≤ 36%. STRETCH: Housing ratio 28–36% or DTI 36–43%. RISKY: Housing ratio 36–43% or DTI > 43%. NOT VIABLE: Housing ratio > 43% or negative monthly buffer. These thresholds are based on Fannie Mae, FHA, and CFPB lending standards.
DATA SOURCES
IRS 2026 Tax Brackets · Fannie Mae Qualified Mortgage Standards · CFPB Ability-to-Repay Rule · FHA Lending Guidelines · State tax rate databases · County-level property tax assessments