You should combine your mortgage, rent, real estate taxes and home owner's insurance when determining your monthly budget amount. What percentage of your net income should go towards a home mortgage? And you should make sure that you don't go … If you can’t afford to pay cash for a house, you’re in good company. The total of these factors should never exceed 28 percent of your pretax income each month. Down Payment Saving up a down payment for a home helps minimize monthly payments. Why it works: It helps you focus on what you’ll need in the future. Lets say you have $5000 coming in per month, how much is a safe amount to spend on a mortgage, while still saving some for car payments, other loans, insurance, groceries, emergencies, etc? As a rule of thumb, mortgage lenders don't want to see you spending more than 36 percent of your monthly pre-tax income on debt payments or other obligations, including the mortgage you are seeking. Your mortgage or rent should not exceed 35 percent of you net income, according to financial adviser and author Dave Ramsey. These numbers can be applied to rent, Bach notes. So if you earn $70,000 a year, you should be able to spend at least $1,692 a month — and up to $2,391 a … When determining what percentage of income should go to mortgage, a mortgage broker will typically follow the 28/36 Rule.The Rule states that a household should not spend more than 28 percent of its gross monthly income on housing-related expenses. The income rule . You should save 20x your gross annual income. Lenders usually limit mortgage payments to less than 30 percent of available and verifiable monthly income. If you want to know more about the percentage of your income that should go to mortgage, then you have come to the right place. That's the general rule, though they may go to 41 percent or higher for a … Income used for housing: What others say The traditional model: 35%/45% of pretax income. We have gathered all relevant information to help you understand everything that you need to know. Gross income is your complete family unit pay before you deduct charges, debt installments and other different costs. Some experts suggest that the total amount you pay towards your mortgage should not exceed 28% of your gross (rather than net) income. As a general rule of thumb, your monthly housing payment should not exceed 28 percent of your income before taxes. In an article on how the mortgage crash of the late 2000s changed the rules for first-time home buyers, the New York Times reported: “If you’re determined to be truly conservative, don’t spend more than about 35% of your pretax income on mortgage, property tax, and home insurance payments. To calculate what your maximum monthly mortgage payment should be, multiply your yearly salary by 0.28, then divide that number by 12. 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