Home Affordability Calculator
Find out how much house you can afford. Enter your income, monthly debts, and down payment to see your maximum home price, monthly payment breakdown, and debt-to-income ratios.
Pre-tax income from all sources
Car loans, student loans, credit card minimums
Your available savings for down payment
Annual mortgage interest rate
% of home value per year (varies by state)
Typical range: $100–$200/month
Maximum Home Price
$282,682
with $60,000 down payment at 6.75% rate
Monthly Payment Breakdown
| Principal & Interest | $1,444 |
| Property Tax (est.) | $259 |
| Homeowners Insurance | $150 |
| Total Monthly (PITI) | $1,853 |
Front-end DTI
26.2%
Back-end DTI
33.2%
At a Glance — Affordability Scenarios
Conservative
25% front-end DTI
$271,523
Recommended
28% front-end DTI
$282,682
Aggressive
36% back-end DTI
$291,030
How to Use This Calculator
Follow these four steps to find out how much house you can afford:
- Enter your annual gross income — pre-tax income from all sources. For couples, use combined household income.
- Enter monthly debt payments — include car loans, student loan minimums, credit card minimums, and any other recurring debt. Do not include rent (it goes away when you buy).
- Enter your down payment savings — a larger down payment increases your buying power and eliminates PMI if you reach 20% of the home price.
- Adjust rate and term — the current 30-year rate and your loan term significantly affect how much you can borrow.
Results update instantly as you type. Use the three scenario cards (conservative, recommended, aggressive) to understand how different DTI comfort levels translate into home price.
Formulas & Methodology
The 28/36 DTI Rule
Lenders use two ratios to cap how much you can borrow:
Front-end DTI
Housing costs ÷ Gross monthly income ≤ 28%PITI (principal, interest, taxes, insurance) only
Back-end DTI
All debts ÷ Gross monthly income ≤ 36%Housing + car + student loans + credit cards
Maximum Affordable PITI
Max front-end PITI = Gross monthly income × 0.28
Max back-end PITI = Gross monthly income × 0.36 − Monthly debts
Effective max PITI = min(front-end, back-end)The binding constraint (lower of the two) determines how large a monthly payment you can carry.
Monthly Payment Factor
r = annual rate ÷ 12
n = term in months
factor = r × (1+r)ⁿ / ((1+r)ⁿ − 1)
Max loan = (Max PITI − insurance − down payment × tax rate/12) / (factor + tax rate/12)Solving for max loan algebraically avoids iterative approximation and gives an exact result.
Private Mortgage Insurance (PMI)
PMI is added when your loan-to-value (LTV) ratio exceeds 80% — i.e., your down payment is below 20% of the home price. This calculator uses an annual PMI rate of 0.7% of the loan balance.
Monthly PMI = Loan amount × 0.007 ÷ 12How Income Affects Affordability
Assumes: 6.75% rate, 30-year term, 20% down, 1.1% property tax, $150/month insurance, $0 existing debts.
| Annual Income | Max Home Price | Monthly PITI |
|---|---|---|
| $50,000 | ~$183,000 | ~$1,167 |
| $75,000 | ~$275,000 | ~$1,750 |
| $100,000 | ~$367,000 | ~$2,333 |
| $150,000 | ~$550,000 | ~$3,500 |
| $200,000 | ~$734,000 | ~$4,667 |
Frequently Asked Questions
A common rule of thumb is to spend no more than 28% of your gross monthly income on housing costs (mortgage, taxes, insurance) and no more than 36% of gross income on total debt payments. Your maximum home price is roughly 3–5× your annual income, depending on your down payment, debt load, and interest rate.
The 28/36 DTI rule says: keep your monthly housing costs (principal, interest, taxes, insurance — PITI) at or below 28% of gross monthly income (front-end DTI), and keep all monthly debt payments (housing + car loans + student loans + credit cards) at or below 36% of gross monthly income (back-end DTI). Lenders use the lower of the two to determine the maximum mortgage payment.
DTI is your total monthly debt payments divided by your gross monthly income, expressed as a percentage. Front-end DTI includes only housing costs; back-end DTI includes all recurring debts. Most conventional lenders cap back-end DTI at 43–45%. FHA loans allow up to 57% with compensating factors. A lower DTI improves your chances of approval and the rates you receive.
A larger down payment reduces your loan amount, monthly payment, and total interest paid. Putting at least 20% down eliminates Private Mortgage Insurance (PMI), which typically costs 0.5–1% of the loan per year. Every additional 5% you put down meaningfully increases your buying power at the same monthly payment.
Your monthly mortgage payment (PITI) includes: Principal (paying down the loan balance), Interest (cost of borrowing), Property Taxes (collected in escrow, typically 0.5–2.5% of home value annually), Homeowners Insurance (collected in escrow, typically $100–$200/month), and PMI if your down payment is below 20%.
Using the 28% front-end rule with a 6.75% rate, 20% down, and typical taxes/insurance: estimated monthly PITI ≈ $2,600. To keep housing at 28% of gross income, you'd need approximately $111,000/year ($9,250/month gross). With higher debts or a lower down payment, the required income increases.
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