Home Affordability Calculator
Calculate how much house you can afford based on your income, debts, and financial situation.
Income and Debts
Loan Details
Property Expenses
Home Affordability Results
Maximum Home Price
Down Payment
Monthly Principal & Interest
Total Monthly Payment
Monthly Property Tax
Monthly Insurance
Debt-to-Income Ratio
Understanding Home Affordability
Determining how much house you can afford is crucial to making a smart home purchase. Lenders use several rules of thumb to assess your ability to repay a mortgage, primarily the 28% and 36% rules.
The 28/36 Rule
- 28% Rule: Your monthly mortgage payment (including principal, interest, taxes, and insurance - PITI) should not exceed 28% of your gross monthly income.
- 36% Rule: Your total monthly debt payments (including mortgage, car loans, credit cards, student loans, etc.) should not exceed 36% of your gross monthly income.
Key Factors Affecting Affordability
Income-Based Factors
- • Gross annual income
- • Existing monthly debt obligations
- • Employment stability and history
- • Additional income sources
- • Future income prospects
Loan-Based Factors
- • Down payment percentage
- • Interest rate on the mortgage
- • Loan term (15, 20, 30 years)
- • Credit score and history
- • Type of mortgage (FHA, VA, conventional)
Debt-to-Income Ratio Guidelines
36% or Lower - Excellent
You're in great shape. Most lenders will consider you a low-risk borrower.
37-43% - Acceptable
You may qualify, but you'll have less financial flexibility. Some loan programs accept up to 43% DTI.
Over 43% - High Risk
You may struggle to get approved, and approval could come with higher rates or stricter terms.
Tips to Increase Your Home Buying Power
- Reduce existing debt: Pay down credit cards, auto loans, and student loans before applying
- Improve your credit score: Higher scores qualify for better interest rates
- Increase your down payment: More money down means a smaller loan and better terms
- Shop for better rates: Even 0.25% difference can save thousands over the loan term
- Consider a longer term: 30-year vs 15-year mortgages have lower monthly payments (but higher total interest)
- Add a co-borrower: Combined income can increase buying power
Note: This calculator provides estimates based on common lending guidelines (28/36 rule). Actual loan approval amounts may vary based on credit score, employment history, debt-to-income ratio, down payment, and other factors. These calculations do not include HOA fees, maintenance costs, or other homeownership expenses. Consult with a mortgage professional for personalized advice and accurate pre-approval amounts.
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