Finance calculator
Standalone tool pageMortgage Affordability Calculator
Estimate how much house you can afford based on income, debts, and the standard 28/36 rule.
Output
Result
Estimated affordable home price
Estimated affordable loan
Max monthly housing budget
Max principal & interest/month
Plan your full home buying journey
Determining your budget is just the first step. Use our Mortgage Payment Calculator to see how different interest rates affect your monthly bill, check the Loan Amortization Schedule to inspect principal vs. interest over time, compare a simpler monthly estimate with the Loan Payment Calculator, and track your Savings Goal for that crucial down payment.
How It Works
The calculator determines your maximum monthly housing budget using standard debt-to-income (DTI) limits (e.g., max 28% for housing, max 36% for total debt). It subtracts estimated taxes and insurance to find your maximum principal and interest payment, then reverse-calculates the affordable loan amount and adds your down payment to find the home price.
Example
If your gross income is $8,000/month, the 28% rule sets your max housing payment at $2,240. If taxes/insurance are $400, you have $1,840 for principal & interest. At 6.5% over 30 years, that affords a ~$291,000 loan. With a $60,000 down payment, you could afford a ~$351,000 home.
Key factors in affordability
- Gross income: Your pre-tax earnings.
- Existing debt: Car loans, student loans, credit cards reduce what you can borrow.
- Interest rate: Higher rates drastically reduce the loan amount you can afford for the same monthly payment.
- Down payment: Increases the total home price you can afford on top of the loan.
Frequently Asked Questions
What is the 28/36 rule?
It is a common guideline suggesting your maximum monthly housing payment should not exceed 28% of your gross monthly income, and your total monthly debt payments (including the mortgage) should not exceed 36%.
Does this calculator include property taxes and insurance?
Yes, it estimates an affordable home price by calculating the maximum affordable principal and interest payment, after deducting estimated monthly taxes, insurance, and HOA fees from your available housing budget.
What is Debt-to-Income (DTI) ratio?
DTI compares your total monthly debt payments to your gross monthly income. Lenders use it to measure your ability to manage monthly payments. A lower DTI is better; most conventional loans look for a total DTI under 36% to 43%.
Will a lender approve me for this exact amount?
Not necessarily. This is an estimate based on standard rules of thumb. Lenders will also evaluate your credit score, employment history, assets, and specific loan program guidelines.