Mortgage affordability calculator
Estimate the home price you can afford using the 28/36 guideline.
How it works
The 28/36 guideline limits housing costs to 28% of gross income and total debts to 36%. We use the lower limit, subtract taxes and insurance to find the loan payment, and convert that payment into a loan size and home price.
Lenders set their own limits. HOA fees, mortgage insurance, and closing costs are not included.
Example
With the sample inputs shown above (Gross monthly income ($) = 8000; Monthly debt payments ($) = 600; Down payment ($) = 40000; Mortgage rate (%) = 6.5; Loan term (years) = 30; Monthly property tax and insurance ($) = 450), the calculator returns: Estimated home price: $323,197 (With $40,000 down); Loan amount: $283,197; Max monthly housing: $2,240 (Payment, tax, insurance).
Things to know
Lenders also consider credit score, savings, and loan type, so treat this as a starting range. Property taxes and insurance vary widely by location, so use quotes for your area, and keep cash available for closing costs and repairs.