According to general lender requirements, your monthly mortgage payment, including principal, interest, real estate taxes and homeowners insurance on all your properties, should not exceed 33 percent of your gross monthly income including the net operating income from rental properties.
Formula: Monthly Salary x 0.33
Your total monthly debt obligation including housing expenses, car loans, child support and alimony, credit card bills, student loans and homeowner association fees etc. should not exceed 40 percent of your gross income.
Formula: Monthly Salary x 0.40
This will help you to gauge your finances and the amount of mortgage that you can afford.