Home Affordability Calculator
How much home can you afford? Enter your income, debts, and savings to see your maximum home price along with personalized recommendations for your situation.
Your Financial Picture
Before taxes (gross income)
Car payments, student loans, credit cards, etc.
Current market rate or rate you expect
Calculations use the 28/36 rule: housing costs should not exceed 28% of gross income, and total debts should not exceed 36%. Property tax estimated at 1.2% and insurance at 0.35% of home value annually.
At the edge of recommended limits
Maximum Home Price
$331,097
Maximum Loan
$271,097
Est. Monthly Payment
$2,333
Debt-to-Income Ratios
Monthly Payment Breakdown
Insights & Recommendations
With less than 20% down, you'll pay PMI (about $192/month). Increasing your down payment can eliminate this cost.
Ready to get pre-approved?
See what rates you actually qualify for based on your credit and finances.
Get My QuoteUnderstanding Home Affordability
Determining how much home you can afford involves more than just looking at the purchase price. Lenders use several factors to assess your ability to repay a mortgage, with two key ratios being the most important.
The 28/36 Rule
Most lenders follow the "28/36 rule" when evaluating mortgage applications:
- Front-End Ratio (28%): Your total monthly housing costs (mortgage payment, property taxes, insurance, and HOA) should not exceed 28% of your gross monthly income.
- Back-End Ratio (36%): Your total monthly debt payments (housing costs plus car loans, student loans, credit cards, and other debts) should not exceed 36% of your gross monthly income.
Factors That Affect Affordability
- Down Payment: A larger down payment means borrowing less and can help you afford a more expensive home. It can also eliminate private mortgage insurance (PMI) if you put down 20% or more.
- Interest Rate: Even small differences in interest rates significantly impact how much you can borrow. A lower rate means lower monthly payments and more buying power.
- Existing Debts: Monthly payments on car loans, student loans, and credit cards reduce how much you can spend on housing while staying within the 36% back-end ratio.
- Credit Score: A higher credit score typically qualifies you for better interest rates, increasing your purchasing power.
Beyond the Numbers
While this calculator shows what lenders might approve you for, consider your personal comfort level. You may want to target a lower price point to:
- Maintain an emergency fund
- Continue saving for retirement
- Have room for home maintenance and repairs
- Enjoy life without being "house poor"
A good rule of thumb is to buy a home that costs no more than 3 to 4 times your annual household income.