How Much Debt Should You Have Before Buying a House?
September 17, 2026
Buying a home is exciting, but it can also feel like walking a tightrope when you already carry other debt. The question of how much is too much comes up in nearly every conversation I have with prospective buyers. The honest answer is that it depends on more than just your credit score, and understanding the rules lenders actually use can save you months of frustration.
Lenders evaluate your total monthly debt obligations against your gross monthly income using what's called a debt-to-income ratio, or DTI. The most common benchmark is the 28/36 rule: your housing payment (including taxes, insurance, and any HOA dues) should stay below 28% of your gross income, while your total monthly debts, including the new mortgage, should stay below 36%. Conventional loans often allow up to 45% or even higher in some cases, while FHA loans have their own flexible thresholds. The exact number a lender accepts depends on the loan program, your credit score, and how much you have saved for a down payment and reserves.
Not all debt weighs the same in a lender's eyes. A car loan, student loan, or credit card balance all count toward your monthly obligations, even if the balances are small. Credit card minimums are calculated based on the highest balance across all your cards, which can surprise people who pay their cards in full each month. Student loans in deferment still get counted using a percentage of the balance. The good news is that some debts can be paid down or restructured before you apply, which can meaningfully shift your qualifying power.
In today's environment, with rates still elevated and home prices holding firm in most markets, the monthly payment on a given loan amount is higher than it was just a few years ago. That means the same DTI ratio covers less house than it used to. Buyers who would have comfortably qualified in a lower-rate environment may find themselves stretched at today's payment levels, even with the same income and debts. This is why getting prequalified before you fall in love with a listing matters more than ever. A quick review of your debts and income can tell you what you can actually afford, not just what a mortgage calculator suggests.
The right amount of debt before buying a house is less about a magic number and more about how your obligations stack up against your income and the loan program you choose. A short conversation with a knowledgeable loan officer can clarify where you stand and what adjustments might help. The sooner you have that conversation, the more options you keep open.