28/36 Rule Calculator
From monthly income, housing costs and other debts, work out the front-end ratio (28%) and back-end ratio (36%) to judge whether your mortgage and debt burden is healthy.
Input Data
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At a glance:The 28/36 rule is a rule of thumb for judging whether your mortgage and overall debt burden is healthy, widely used as a self-check before applying for a mortgage. It has two ratios: front-end ratio = monthly housing expense ÷ gross monthly income × 100%, ideally ≤ 28%; back-end ratio = (housing expense + other monthly debts) ÷ gross monthly income × 100%, ideally ≤ 36%. When both are met, debt is not over-eating your income and you still have room for living costs and surprises.
Formula
Front-end ratio = monthly housing expense ÷ gross monthly income × 100% (ideally ≤ 28%).
Total monthly debt = monthly housing expense + other monthly debts.
Back-end ratio = total monthly debt ÷ gross monthly income × 100% (ideally ≤ 36%).
$$$Front = \\dfrac{Housing}{Income}\\times100\\%$ ( $\\le 28\\%$)$$$$$Back = \\dfrac{Housing + OtherDebt}{Income}\\times100\\%$ ( $\\le 36\\%$)$$$$$\\dfrac{9{,}000}{40{,}000}=22.5\\%$$\\dfrac{12{,}000}{40{,}000}=30\\%$$$How to Use
- Enter your gross monthly income.
- Enter monthly housing expense (mortgage, rates, management fee, etc.).
- Enter other monthly debt repayment, then check whether front-end and back-end ratios are within 28% / 36%.
Front / back-end ratios under different income and expense combinations
| Gross monthly income (HK$) | Housing expense (HK$) | Other debts (HK$) | Front-end ratio | Back-end ratio | Assessment |
|---|---|---|---|---|---|
| 40,000 | 9,000 | 3,000 | 22.5% | 30% | Both within limits — ideal |
| 30,000 | 9,500 | 3,000 | 31.67% | 41.67% | Both over limit — heavy |
| 50,000 | 12,000 | 8,000 | 24% | 40% | Front OK, back over limit |
Case Studies
Case 1: A healthy, ideal situation
Person with gross monthly income HK$40,000, monthly housing (mortgage, rates, management, etc.) HK$9,000, other debts (cards, personal loan) HK$3,000.
Front-end = 9,000 ÷ 40,000 = 22.5% (below 28%); total debt = 9,000 + 3,000 = HK$12,000, back-end = 12,000 ÷ 40,000 = 30% (below 36%).
Read: both ratios are within the suggested caps — mortgage and overall debt are healthy, with comfortable room for living and saving. This profile is usually favourable in bank mortgage reviews.
Case 2: Housing looks fine, but other debts sink it
Person with gross monthly income HK$50,000, housing HK$12,000, plus car loan and cards totalling HK$8,000.
Front-end = 12,000 ÷ 50,000 = 24% (met, below 28%); but total debt = 12,000 + 8,000 = HK$20,000, back-end = 20,000 ÷ 50,000 = 40% (over 36%).
Read: housing alone looks healthy at 24%, but including other debts the back-end hits 40%, above the cap. This shows affordability is not just about the mortgage — cards, car loans and instalments also squeeze income. To improve, clear high-interest debt (e.g. cards) first to bring the back-end under 36% before applying for a mortgage. ⚠️ HK banks also apply DSR and stress test; actual approval is up to the bank.
FAQ
What do 28 and 36 mean?
28 is the front-end cap: housing expense should not exceed 28% of gross monthly income. 36 is the back-end cap: total repayment including all debts should not exceed 36% of gross monthly income.
What counts as housing expense?
Typically mortgage principal & interest, rates, government rent, management fee, and property-related insurance. Tenants can use rent as a rough substitute.
Does passing 28/36 guarantee a mortgage?
Not necessarily. HK banks also apply the Debt Servicing Ratio (DSR) and stress test. The 28/36 rule is only a self-check on affordability; actual approval is up to the bank.
Why use gross instead of net income?
The 28/36 rule traditionally uses gross monthly income, matching most mortgage approvals and international practice: it standardises comparison, aligns with lenders' basis, and is easy to obtain. But because take-home pay is lower after tax and MPF, treat the caps conservatively or re-check with net income.
In Hong Kong, does passing 28/36 mean the mortgage is approved?
No. The 28/36 rule is only a self-check, not HK's formal mortgage standard. Banks are bound by HKMA rules: DSR caps, stress test (rate-rise scenario), LTV caps, income proof and TU credit report all matter. Use 28/36 as a first filter, then ask a bank or licensed mortgage broker about actual limits and stress test. ⚠️ This calculator is for reference only and is not borrowing or financial advice.
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References
Content review: Calculatorism Finance Team. Results are for reference only; please refer to the relevant authorities for the official figures.