re: Help determining how much mortgage I can afford

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(Seriously, that 20% down rule of thumb is ridiculous)

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20% down gives you a better interest rate with no PMI allowing your PITI to be much less of a monthly burden. In addition, having equity in your home allows you more flexibility in the event there is a downturn in the market. For instance, if you need to relocate, you won't need approval from the lender to sell the property short. If you put 5% down and the market goes down by 10%, you have to come to closing with the additional 5% (less any principle paid already). It is all about how much risk you feel comfortable living with not that one way is necessarily smart or dumb.