If you’re thinking about buying a home, you may have come across something called the 30/30/3 rule. As a Harford County, Maryland Realtor who works with many first-time buyers, move-up buyers, and relocating families, I am a big fan of this guideline.
The 30/30/3 rule is not a lender requirement. It is a practical framework designed to help home buyers stay financially comfortable after they purchase a home. In my experience, that comfort matters just as much as getting in a home.
What is the 30/30/3 rule?
The 30/30/3 rule breaks down into three simple parts:
30% for housing
Your monthly housing payment should not exceed 30% of your gross monthly income. This includes your mortgage payment, property taxes, homeowners insurance, and HOA fees (which you will find in many Harford County neighborhoods).
30% for the down payment
You should aim to put down 30% of the purchase price.
3 months of reserves
You should have at least three months of living expenses saved after closing.
This rule is definitely conservative. Many buyers will qualify for much more through a lender, but qualifying and being comfortable are not the same thing.
Why lenders approve buyers for more than they should spend
One of the most common things I see in Harford County is buyers being approved for an amount that feels exciting but is not always practical long term.
Lenders are focused on debt-to-income ratios and risk. They are not looking at your lifestyle, your travel plans, future childcare costs, hobbies, or the fact that you might want to replace your roof or HVAC system someday.
I have worked with many buyers who say, “We can afford the payment,” but what they really mean is, “We can afford it if nothing ever changes.”
Life does change.
Cars break down. Kids need braces. Property taxes increase. Heating systems fail in the middle of winter. And you still deserve to enjoy dinners out, vacations, and hobbies.
You should not have to live for your house. Your house should support your life, not consume it.
Why I like the 30% housing guideline
Keeping your housing costs at or below 30% of your income creates breathing room. It allows you to handle unexpected expenses without stress and continue saving for the future.
In our local market, I often help buyers explore multiple price ranges so they can see the difference between what they qualify for and what actually feels comfortable month to month.
Is 30% down realistic?
For many home buyers, especially first-time buyers, a 30% down payment is not realistic or required. There are excellent loan programs that allow for much less down.
That said, the spirit of this part of the rule is about reducing risk.
A larger down payment means:
- A lower monthly payment
- Less interest paid over time
- No PMI
- More equity from day one
- Better protection if the market shifts
Even if 30% is not achievable, aiming higher than the minimum can make a meaningful difference.
Why three months of savings matters
Unless you are buying new construction, homeownership comes with surprises.
In just the past year, I have seen buyers deal with water heaters failing, unexpected plumbing issues, and roof repairs within months of closing. None of these were deal breakers, but they were stressful for buyers who had little savings left after their purchase.
Having three months of expenses saved gives you confidence. It turns emergencies into inconveniences.
How I use this rule with my clients
When I meet with buyers in Bel Air, Abingdon, Havre de Grace, and throughout Harford County, I like to talk about lifestyle before price.
Where do you want to travel?
Do you want kids soon?
Do you like dining out?
Do you work in a stable industry?
Those answers matter just as much as your credit score.
The 30/30/3 rule helps us build a plan that supports both homeownership and real life.
Final thoughts from a local Realtor
Buying a home is one of the most important financial decisions you will ever make. It should feel exciting, not stressful.
While the 30/30/3 rule is not perfect for everyone, I believe it is one of the healthiest starting points for long term success as a homeowner.
If you are thinking about buying a home in Harford County and want help figuring out a comfortable price range, I would be happy to walk through your numbers with you and create a plan that fits your life, not just your loan approval.