To figure out how much mortgage you can afford, your lender will compare the money coming in to the money going out and represent this as a figure called the debt-to-income ratio, or DTI.
Remember the mortgage rule of thumb-- no more than 36% of your gross monthly income should go toward debts, including a mortgage. And your mortgage shouldn’t be more than 28% of your pre-tax earnings. If you have compensating factors, like excellent credit or large cash reserves, you may be able to swing a higher DTI.