House Affordability Calculator
Calculate Your Home-Buying Budget Based on Income, DTI Ratio, or Monthly Budget.
Your Estimated Affordability Results
| Amount | Amount | ||
|---|---|---|---|
| Home Price | Monthly Payment | ||
| Down Payment | Estimated Closing Cost | ||
| Loan Amount | Front-end DTI Ratio | ||
| Total Payment | Back-end DTI Ratio | ||
| Total Interest | Upfront Payment at Closing | ||
| Upfront FHA MIP (1.75%) | |||
| VA Upfront Funding Fee |
| Monthly | Annual | Total | |
|---|---|---|---|
| Mortgage Payment | |||
| Property Tax | |||
| Home Insurance | |||
| HOA Fee | |||
| Maintenance Cost | |||
| Other Costs | |||
| Total Housing Cost |
Amortization Schedule
| Year | Principal | Interest | Payments | PMI / MIP | End Balance | Total OOP |
|---|
| Month | Principal | Interest | Payments | PMI / MIP | End Balance | Total Paid | Total OOP |
|---|
What This Home Affordability Calculator Estimates
Use the calculator to compare different loan scenarios and understand how your income, debt, down payment, and interest rate may affect your buying power.
- Estimated maximum home price
- Estimated loan amount and down payment
- Monthly principal and interest payment
- Front-end and back-end debt-to-income ratios
- Property taxes and homeowners insurance
- Conventional PMI and FHA mortgage insurance
- VA upfront funding fee estimates
- HOA fees, maintenance, and other annual costs
- Estimated closing costs and upfront cash required
- Monthly and annual housing cost breakdowns
- Monthly and annual amortization schedules
DTI Ratio and the 28/36 Rule
Debt-to-income ratio, or DTI, compares your monthly debt obligations with your gross monthly income. It is one of the key numbers lenders use when reviewing mortgage applications.
The basic formula is:
DTI = Monthly Debt Payments ÷ Gross Monthly Income × 100
The commonly used 28/36 rule is a conventional mortgage guideline:
- Front-end ratio: Housing expenses should generally stay near or below 28% of gross monthly income.
- Back-end ratio: Total monthly debt, including housing, auto loans, student loans, credit cards, and other debt, should generally stay near or below 36% of gross monthly income.
For example, if your gross monthly income is $10,000, a 28% front-end limit would allow about $2,800 per month for housing. A 36% back-end limit would allow about $3,600 per month for total debt payments. If you already pay $600 per month toward other debt, your remaining back-end room for housing would be about $3,000.
Actual lender approvals may vary. Some conventional loans may allow higher back-end DTI ratios depending on credit score, reserves, down payment, loan program, and automated underwriting results.
FAQs
What is a good DTI ratio for buying a house?
A lower DTI is generally better. Many buyers use 28% for housing costs and 36% for total debt as a conservative target. Some lenders may approve higher ratios, especially for FHA, VA, or strong conventional applications. However, qualifying for a larger loan does not always mean the payment is comfortable.
How do I calculate my debt-to-income ratio?
Add your monthly debt payments, then divide that number by your gross monthly income. For mortgage affordability, lenders often look at both housing-only DTI and total-debt DTI. Monthly debt usually includes car loans, student loans, personal loans, credit card minimums, and other required debt payments.
Does this calculator include property taxes and insurance?
Yes. You can enter property taxes and homeowners insurance as either a percentage or a dollar amount. These estimates matter because taxes and insurance can add hundreds of dollars per month to the cost of owning a home.
Does a 20% down payment increase affordability?
A larger down payment can increase affordability because it lowers the loan amount and may remove PMI on a conventional mortgage. However, you should also keep enough cash available for closing costs, moving expenses, emergency savings, repairs, and furniture or appliance purchases.
Why is my affordable home price lower than what I see on real estate websites?
Real estate listing platforms may show estimated payments using assumptions that differ from your actual taxes, insurance, HOA fees, mortgage insurance, credit profile, or lender quote. This calculator is designed to show a more complete ownership-cost estimate, not just the advertised mortgage payment.
How do FHA loans affect affordability?
FHA loans may allow higher DTI ratios and lower down payments, which can increase the estimated home price you may qualify for. The tradeoff is mortgage insurance. FHA loans include upfront MIP and annual MIP, which can increase both upfront and monthly costs.
How do VA loans affect affordability?
VA loans may improve affordability for eligible borrowers because they typically require no down payment and no monthly PMI. A VA funding fee may apply unless the borrower is exempt. Because VA loan terms can vary, eligible buyers should compare VA quotes with other mortgage options.
Are closing costs included in the monthly payment?
No. Closing costs are shown separately as part of your estimated upfront cash needed at closing. Typical closing costs may include lender fees, title fees, escrow costs, prepaid taxes, prepaid insurance, recording fees, and other settlement charges.
How much should I budget for home maintenance?
A common rule of thumb is to budget around 1% to 2% of the home value per year for maintenance and repairs. Older homes, larger homes, homes with pools, and homes in harsh weather areas may require a higher budget.
Is this the same as a mortgage preapproval?
No. This calculator provides an estimate for planning purposes. A mortgage preapproval requires a lender to review your credit, income, assets, debts, employment, property type, loan program, and documentation.
Important Disclaimer
This calculator is for educational and planning purposes only. It does not guarantee mortgage approval, loan terms, interest rates, taxes, insurance premiums, HOA fees, closing costs, or lender underwriting results. For an accurate loan estimate, contact a licensed mortgage lender or financial professional.
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