If you put down a minimum for FHA loan, including taxes and insurance, a 4% rate would take about $3,700 absolute minimum or $5,100 typically a month in gross earnings over the last 2 years. No, this is not guaranteed or an offer to lend. Rates, down payment, credit standing and other factors apply.
The calculation is straight-forward, although not easy to understand. The current interest rates are around 4%, which you can your rate independently. The principal and interest on a loan of $175,000 for a 30-year at 4% is $835.48 monthly. In addition you would have to pay into escrow for taxes, insurance and MIP.
A typical house priced around $180k bears a 2.5% tax rate, or $5,500 per year, $458.33. If you know the tax rate on the house, you can figure this more accurately. Tax rate do vary widely over DFW, from 1.8% to 3.3%, but typically are around 2.5%.
Insurance is again subject to the carrier and coverage you carry. While it is not a quotation for a particular coverage, you should budget for between 0.5% and 1.0% annually for homeowner's insurance. Typically, our experience is that buyer find insurance for about 0.8% of value. You are normally required to carry insurance to protect the lender against loss for the full value of the house.
So, on a $180k house you should budget about 0.8% or $1,350 per year, $112.50 per month.
You will also be required to pay mortgage insurance premium (MIP), which is 1.75% in a single upfront payment at the time of closing, and can be rolled into the loan balance. If rolled into the loan balance, the payment would rise by about $8/$1k of loan, or $15/month for this $175k loan.
But, there is also a monthly MIP payment, which for loan-to-values of 95% or more (includes the minimum 3-1/2% down case) is 1.25% per year or about 0.104% per month times $175,000 adds $2,187 per year or $182.29/month.
Now, adding all this up: 835.48 + 15 + 182.29 + 458.33 + 112.50 = $1,603.60 for a monthly payment. Note: taxes and insurance should be computed when you get the real figures. The $15 is for P+I on the increase in loan balance by adding the UFMIP.
So, this $1604 monthly payment cannot exceed 31% of your gross income and when your credit card and other loan payments are added the total cannot exceed 43%.
Let's say you don't have any other debt (unlikely). Then you can calculate $1604 as 43% of your gross, making your gross at least $3729.30 per month if allowed. Or, normally $1604 is 31% of $5,172.90, which means an annual income of $62,075.
Good luck. I hope you enjoyed the higher math.