If I Make $110,000 A Year What Mortgage Can I Afford?

If I Make $110,000 A Year What Mortgage Can I Afford?

You can afford a home price up to $420,000 with a mortgage of $399,000.

This assumes a 5% down conventional loan at 7%, standard mortgage insurance, low debts, good credit, and a total debt-to-income ratio of 45%.

Remember that many factors affect this number including property taxes, homeowner’s insurance, HOA dues, and more. Apply with a lender to find your personalized maximum home price.

See what you can afford with a $110k salary.

$110,000 income mortgage payment breakdown

Principal and interest payments aren’t the only costs due each month. Many advertisers leave out other expenses like mortgage insurance and property taxes. But you must factor in all costs that lenders do: property taxes, homeowners insurance, and HOA dues.

Part of paymentAmount
Principal & interest$2,654
Monthly mortgage insurance$176
Homeowner’s insurance$100
HOA dues$0
Total payment based on these assumptions$3,280

See assumptions for all calculations at the bottom of this article.

Home affordability by monthly debt payments

Your debt level affects your buying power perhaps more than anything else.

For instance, say you have $750 in monthly debt like student loans and credit card payments. This amount of debt isn’t hurting you much. But adding another $500-per-month auto payment would reduce your maximum home price to just $355,000 instead of $420,000.

Lenders can approve you to use up to 45% of your gross monthly income toward debt payments. That’s $4,125 for an annual salary of $110,000. About 36% of your gross income ($3,300) can be used for the house payment leaving about $800 for other debts.

Yearly income$110,000
Monthly income$9,167
Max house payment (36%)$3,300
Max total debt payments (45%)$4,125

Terms you might hear are “36% front-end debt-to-income (DTI) ratio” and “45% back-end DTI.” This just means you’re spending 36% of gross income on the house and 45% on the house plus other debt payments. Borrowers with good credit can be approved with higher ratios, but to be safe we are using these numbers.

Following is what you might qualify for depending on your current debt load.

Annual IncomeMonthly DebtMax House PaymentMax Home Price

Related: Buying a Home With Zero Down Payment

Maximum home price by down payment

Your down payment dramatically affects affordability.

For one, your loan balance drops with more down, resulting in a lower monthly payment. Additionally, you pay less mortgage insurance.

Annual IncomeDown PaymentMonthly PaymentHome Price
$110,0003.5% (FHA)$3,667$460,000*

*Your maximum FHA home price is higher due to more lenient DTI standards

No down payment? Check out down payment assistance programs. Start here.

Maximum home price by interest rate

Interest rate is another significant determiner of your maximum home price. If rates drop, it’s a great time to enter your home search.

Annual IncomeInterest RateMonthly PaymentHome Price

Maximum home price by desired debt-to-income level

While many financial gurus suggest you have a debt-to-income of 25% or less, it’s unrealistic in most markets. Pushing your front-end (housing) DTI from 25% to 36% increases your buying power by $150,000.

Annual IncomeDTIMax PaymentHome Price

Ways to increase your buying power

Here are ways to qualify for a bigger home price.

Adjustable-rate mortgage (ARM): As seen above, reducing your rate from 7% to 6% can increase your buying power by $50,000 at your income level. An ARM gives you a fixed rate for a few years while you wait for a chance to refinance or increase your income to afford a potentially higher payment later.

Avoid HOAs. Adding HOA dues to your housing payment could cut your buying power by $50,000 or more.

Put more down or get gift funds. The lower your mortgage balance, the lower your payment will be. Try to find down payment assistance (DPA) programs or get a gift from family to reduce your loan amount.

Use FHA. These loans are lenient on debt-to-income ratios. Conventional loans allow a DTI up to 45% including all debts and total housing payment (50% in select cases). FHA’s max is 56.9% for well-qualified buyers.

Pay off debt: Paying off a $500 car payment can increase your buying power by $70,000.


If I make $110,000 per year what mortgage can I afford?

You may be able to afford a $420,000 home with a mortgage of $399,000. Your maximum loan amount depends on your debts, interest rate, property taxes, homeowner’s insurance, HOA dues, loan program, and payment comfort level.

Should I pay off debt before I buy a home?

Reducing your debt payments by $500 per month can increase your maximum home price by about $70,000 if you make $110k per year. Paying off debt will help you qualify for a better home that will suit your needs longer.

Do you need good credit to buy a home at $110k salary?

You don’t need a high credit score. An FHA loan requires just a 580 score and allows for high debt-to-income ratios. However, a higher credit score will help you qualify for a conventional loan or larger FHA loan.

You can afford a decent home with a $110,000 salary in many areas

You may have been told that you can’t afford a decent home on $110,000 per year. But if you use creative financing for homeownership and are committed to becoming a homeowner, you can very likely make it happen.

See if you are eligible to buy a home.

All calculations assume a 5% down conventional loan at 7%, $350/mo property taxes and $100/mo insurance, MGIC mortgage insurance factors, 740 credit score, no HOA, $800 or less in monthly debt payments. Your rate and costs will vary.


  • Tim Lucas

    Tim Lucas (NMLS 118763) has 20 years of hands-on mortgage industry experience helping everyone from first-time buyers to experienced investors. He purchased his first home at 26 with just $1,100 out-of-pocket and now owns real estate worth $2.4 million. Tim was the managing editor at national websites TheMortgageReports.com and MyMortgageInsider.com and has been featured in publications such as Time, U.S. News, MSN, and more. He is a licensed loan originator (NMLS 118763). Connect with Tim on LinkedIn, Twitter, and TikTok.