Mortgage Affordability Calculator
Calculate how much house you can afford based on your income, debts, and loan terms. Uses standard debt-to-income ratios to determine your maximum home purchase price.
Income Information
Monthly Debt Payments
Property Details
Loan Information
DTI Ratio Limits
Complete Guide to Mortgage Affordability
Understanding how much house you can afford is one of the most important steps in the home buying process. This calculator uses industry-standard debt-to-income ratios and loan guidelines to help you determine a realistic home purchase budget.
The 28/36 Rule
The most common guideline for mortgage affordability is the 28/36 rule, which states:
- 28% Front-End Ratio: Your monthly housing expenses (mortgage, taxes, insurance, HOA) should not exceed 28% of your gross monthly income
- 36% Back-End Ratio: Your total monthly debt payments (including housing) should not exceed 36% of your gross monthly income
Loan Type Guidelines
Conventional Loans
- Front-End Ratio: 28% (can go higher with strong credit)
- Back-End Ratio: 36% (up to 45% with compensating factors)
- Minimum Down Payment: 3-5% (20% to avoid PMI)
- Credit Score: Typically 620+ minimum
FHA Loans
- Front-End Ratio: 31%
- Back-End Ratio: 43% (up to 57% with compensating factors)
- Minimum Down Payment: 3.5%
- Credit Score: 580+ for 3.5% down, 500+ for 10% down
- Mortgage Insurance: Required for life of loan
VA Loans
- No specific front-end ratio requirement
- Back-End Ratio: 41% guideline (flexible with residual income)
- Minimum Down Payment: 0%
- Credit Score: No minimum (lender dependent)
- No PMI required
What Counts as Monthly Debt?
- Credit card minimum payments
- Auto loans
- Student loans
- Personal loans
- Child support or alimony
- Other property loans or mortgages
- Any other recurring debt obligations
Costs Beyond the Mortgage
Property Taxes
Typically 0.5-2.5% of home value annually, varying by location. Check local rates before buying.
Homeowners Insurance
Usually 0.3-1.0% of home value annually. Higher in areas prone to natural disasters.
HOA Fees
Can range from $100-1000+ monthly. Always factor these into your budget before purchasing.
PMI (Private Mortgage Insurance)
Required with less than 20% down on conventional loans. Typically 0.3-1.5% of loan amount annually.
Don't Forget These Costs
One-Time Costs
- Closing Costs: 2-5% of purchase price
- Moving Expenses: $1,000-5,000+
- Home Inspection: $300-600
- Appraisal: $300-600
- Initial Repairs/Updates: Variable
Ongoing Costs
- Utilities: $150-300+/month
- Maintenance: 1-3% of home value annually
- Lawn Care: $50-200+/month
- Emergency Fund: 3-6 months expenses
Improving Your Affordability
Short-Term Strategies
- Pay down existing debts
- Increase down payment savings
- Improve credit score
- Consider a co-borrower
- Look in different areas
Long-Term Strategies
- Increase income through career growth
- Build stronger credit history
- Save for larger down payment
- Reduce recurring expenses
- Consider house hacking
Important Disclaimer
This calculator provides estimates based on general lending guidelines. Actual loan approval depends on many factors including credit history, employment stability, assets, and lender-specific requirements. Always get pre-approved by a lender for accurate affordability assessment. Consider working with a mortgage professional to understand all your options.