Mortgage Affordability Calculator

How much house can I afford?

This mortgage affordability calculator works backward from what you can pay each month to the most expensive home that fits. It has two modes. Based on Income applies the debt-to-income (DTI) limits lenders use to your gross income and existing debts. Based on Monthly Budget starts from a fixed amount you want to spend on housing each month. Both find the highest home price whose monthly housing payment stays within the limit.

The monthly housing payment is the mortgage principal and interest, mortgage insurance when it applies, property tax, homeowners insurance, and HOA or co-op fees. Property tax, insurance, HOA fees, and maintenance can be entered as a percentage of the home price per year or as a dollar amount per year.

For example, a household earning $95,000 a year with $400 of other monthly debt, a 20% down payment, a 30-year loan at 6.5%, property tax of 1.1%, and insurance of 0.6% can afford a home of about $342,437 under the 28/36 rule. That is a $273,950 loan with a principal and interest payment of about $1,732 a month.

Front-end and back-end DTI ratios

The front-end ratio is your monthly housing payment divided by gross monthly income. The back-end ratio adds your other recurring debts, such as car loans, student loans, and credit card minimum payments. The calculator uses whichever limit is reached first.

• Conventional loan, the 28/36 rule: housing up to 28% of income and all debts up to 36%. A down payment under 20% adds private mortgage insurance (PMI), estimated at 0.5% of the loan per year.
• FHA loan: housing up to 31% and all debts up to 43%. FHA loans charge an upfront mortgage insurance premium of 1.75% of the loan plus an annual premium. On terms over 15 years the annual premium is 0.55% with less than 5% down, or 0.50% with 5% or more. On terms of 15 years or less it is 0.40% with less than 10% down, or 0.15% with 10% or more. Loans above $726,200 pay more: 0.75% or 0.70% on terms over 15 years, and 0.65% with less than 10% down, 0.40% with 10% or more, or 0.15% with 22% or more on terms of 15 years or less. 31/43 are HUD's benchmark ratios for manually underwritten loans; loans approved through FHA's automated TOTAL Scorecard can go higher.
• VA loan: all debts up to 41%, with no separate housing limit and no monthly mortgage insurance. VA charges a one-time funding fee of 2.15% with less than 5% down, 1.5% with 5% or more, and 1.25% with 10% or more, for first-time use. 41% is the VA's benchmark, not a hard cap: VA lenders also check residual income, the money left each month after major expenses, and can approve a higher ratio when it is strong enough. This calculator applies only the 41% benchmark and does not check residual income.
• A custom percentage from 10% to 50%: a single back-end limit. PMI is added when the down payment is under 20%.

In the example above, the 28% front-end limit is reached first: the housing payment is about $2,217 a month, and adding the $400 of other debt brings the back-end ratio to about 33.1%.

Cash needed at closing and total monthly cost

Cash at closing is the down payment plus estimated closing costs of 3% of the price, plus the FHA upfront premium or VA funding fee when one applies. Many borrowers roll those two fees into the loan instead of paying them at closing.

In the income mode, the total monthly cost also includes a maintenance estimate of 1.5% of the home price per year. Lenders do not count maintenance in DTI, but repairs are a real part of owning a home. In the budget mode you can choose whether property tax, HOA fees, insurance, and your own maintenance estimate come out of the budget, or whether the budget covers only the mortgage payment: principal and interest, plus PMI when the down payment is under 20%.

Frequently asked questions

How much mortgage can I afford?

The loan amount in the results is the mortgage you can afford: the home price minus your down payment. A larger down payment, a lower interest rate, or lower debts all raise it.

Is this a house affordability calculator or a home affordability calculator?

Both names describe the same thing. A house affordability calculator, home affordability calculator, and mortgage affordability calculator all estimate the price you can afford from your income, debts, and down payment.

What is the 28/36 rule?

It is a common guideline for conventional loans: spend no more than 28% of gross monthly income on housing and no more than 36% on all debt payments combined. On $6,000 of monthly income, that is $1,680 for housing and $2,160 for all debts.

How much home can I afford with $100,000 a year?

It depends on your debts, down payment, and rate. With no other debt, 20% down, a 30-year loan at 6.5%, 1.1% property tax, and 0.6% insurance, the 28/36 rule allows a home of about $360,460. Enter your own numbers above for an estimate that fits your situation.

Limitations

This is an estimate, not a loan approval. Lenders also look at credit score, savings, employment history, loan limits, and their own DTI overlays. PMI rates vary with credit score and down payment, and the VA funding fee is higher after first use and waived for some veterans. Closing costs and maintenance vary widely by location.