The amount you can borrow depends on several factors: your credit score, income, existing debt obligations, and the lender's maximum loan limits. Understanding these factors before you apply helps you set realistic expectations and find the right lender.
How Much Can You Borrow? By Credit Score
| Credit Score Range | Typical Loan Amount | Typical APR Range | Best Lenders |
|---|---|---|---|
| 760–850 (Excellent) | 3–4x annual income | Best available rates | All lenders |
| 720–759 (Very Good) | 3–4x annual income | Near-best rates | All lenders |
| 680–719 (Good) | 2.5–3.5x annual income | Slightly higher rates | Most lenders |
| 640–679 (Fair) | 2–3x annual income | Higher rates, FHA option | FHA lenders, some conventional |
| 580–639 (Poor) | 1.5–2.5x annual income | FHA only (3.5% down) | FHA-approved lenders |
Key Factors That Determine Your Loan Amount
Your monthly housing payment (PITI: principal, interest, taxes, insurance) should not exceed 28% of your gross monthly income.
Your total monthly debt payments (housing + all other debt) should not exceed 36% of your gross monthly income.
A larger down payment reduces your loan amount, monthly payment, and may eliminate PMI (required when down payment is below 20%).
Mortgage rates vary significantly by credit score. A 760 score may get a rate 1–2% lower than a 620 score, saving tens of thousands over the loan term.
Buying a home is the largest financial decision most people make. Consider waiting or exploring alternatives if:
- Your debt-to-income ratio exceeds 43%: Most conventional lenders cap DTI at 43–45%. Above this, you will likely be declined or offered significantly worse terms. Paying down existing debt before applying will improve your rate and approval odds.
- You plan to move within 3–5 years: Closing costs typically run 2–5% of the loan amount. If you sell before recouping these costs through equity appreciation, you may lose money compared to renting.
- You have less than 3% for a down payment: While FHA loans allow 3.5% down, PMI on low-down-payment loans adds 0.5–1.5% annually to your effective rate. A larger down payment eliminates PMI and reduces your rate.
- Your credit score is below 620: Conventional loans require 620+. FHA loans accept 580+ with 3.5% down, or 500+ with 10% down. Below 500, improving your credit before applying will save tens of thousands in interest over the loan term.
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How to Maximize Your Loan Amount
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Advertiser Disclosure: WiseIQ may earn a referral fee from some lenders and financial products on this page. This does not influence our editorial ratings or recommendations. Our reviews are independently researched and editorially independent.
Sources & Methodology: WiseIQ's editorial team researches and fact-checks all content using primary sources including the Consumer Financial Protection Bureau (CFPB), Federal Reserve G.19 Consumer Credit Report, myFICO Credit Education, and lender websites for current rates and terms. Last reviewed: April 2026. How we rank products.