One of the first questions every North Texas homebuyer asks is: “How much house can I actually afford?” It’s the right question — and the answer depends on more than just your income.
The Two Key Ratios Lenders Use
Mortgage lenders qualify buyers using two debt-to-income ratios:
| Ratio | What It Measures | Guideline |
|---|---|---|
| Front-end DTI | Housing costs ÷ gross income | ≤ 28–31% |
| Back-end DTI | All monthly debts ÷ gross income | ≤ 43–50% |
The 28/36 Rule
A classic guideline: spend no more than 28% of gross monthly income on housing and keep all debt payments under 36%. On a $100,000 salary ($8,333/month), that means housing up to ~$2,333/month.
What Prices Look Like in North Texas
In Frisco, TX, McKinney, TX, Celina, TX, and Prosper, TX, median prices in 2026 range from $380,000–$550,000. Grayson County and Fannin County offer more affordable options in the $250,000–$350,000 range.
Other Factors That Affect Your Budget
- Credit score — higher score means lower rate and more buying power
- Down payment — 3% to 20%+ changes your loan and PMI cost
- Property taxes — Texas has no state income tax but higher property taxes; budget ~2–2.5% of home value annually
- HOA fees — common in North Texas master-planned communities; add $100–$400/month
- Existing debt — car loans, student loans, and credit cards reduce buying power
Quick Affordability Snapshot
| Annual Income | Est. Max Payment | Approx. Home Price |
|---|---|---|
| $75,000 | $1,750/mo | ~$235,000 |
| $100,000 | $2,333/mo | ~$315,000 |
| $130,000 | $3,033/mo | ~$410,000 |
| $160,000 | $3,733/mo | ~$505,000 |
Estimates include taxes and insurance at 6.75% rate with 10% down. Actual qualification depends on credit, debts, and lender guidelines.
The Best Way to Know for Sure
A free pre-approval from a local North Texas lender takes about 15 minutes and gives you a precise number you can take to any seller in Collin County, Denton County, or anywhere across DFW.
Ready to Take the Next Step?
Get a free, no-obligation pre-approval in about 15 minutes. I’ll show you exactly what you qualify for in North Texas.
Apply Now — It’s Free Call 945-300-4644
Or see what North Texas homebuyers say about working with Wayne →
Homewood Mortgage, LLC | NMLS #294974 | Wayne Wallace NMLS #745186 | Licensed in Texas | This is not a commitment to lend. Loan approval subject to credit, income, and property qualification. Programs, rates, and terms subject to change without notice.