Home Affordability Calculator
How much house your income supports, using the same debt-to-income ratios lenders underwrite to — and which of the two is actually limiting you.
The address carries whatever you changed, so anyone opening it sees these numbers. Nothing is saved on our side.
You could afford a home up to
$396,273
Lenders would generally allow up to $2,800 a month for housing here, limited by the housing ratio.
- Principal & interest78%$2,181
- Property tax13%$363
- Insurance4%$116
- Mortgage insurance5%$140
- Monthly housing cost$2,800
- $336,273
- $60,000
- 15.1% of price
- $2,800
- the ceiling, not a target
- $2,181
- 33%
- ceiling 36%
- $140
- under 20% down
What a bigger down payment buys
More cash down means less to borrow, and crossing 20% removes mortgage insurance from the monthly cost — which frees budget for a larger loan.
| Down payment | Max price | Monthly PMI | vs yours |
|---|---|---|---|
| $30,000mortgage insurance applies | $370,741 | +$2 more in total | |
| $60,000yoursmortgage insurance applies | $396,273 | — | |
| $90,000no mortgage insurance | $439,772 | −$140 less in total | |
| $120,000no mortgage insurance | $465,060 | −$140 less in total |
How this calculator works
Two ratios set a monthly ceiling. The price is then whatever fits inside it.
min( income × 28%, income × 36% − other debts )
Whichever allows less is the binding constraint, and the result says which one it was. With few other debts the housing ratio binds; with a car loan and a student loan the total-debt ratio usually does, and paying those down raises what you can borrow more than saving a little extra deposit.
Working back from that ceiling to a price is not a single division: property tax and insurance scale with the price, the loan scales with the price minus your deposit, and mortgage insurance switches off above 20% down. Rather than invert that algebraically, the monthly cost of a given price is computed directly and the price is narrowed down until it exactly fills the budget.
What is not in it
- Closing costs, which typically run 2–5% of the price and are paid on top of the deposit.
- Maintenance, which a lender ignores and a homeowner cannot.
- Reserves. Many lenders want to see months of payments left over after closing.
- Your own judgement about what is comfortable, which is the part that actually matters.
A worked example
A household on $120,000 with $500 of other monthly debt and $60,000 saved.
| Gross monthly income | $10,000 |
|---|---|
| Housing ratio ceiling | $2,800 |
| Total debt ceiling | $3,100 |
| Binding ceiling | $2,800 |
| Principal & interest | $2,181.06 |
| Property tax | $363.25 |
| Insurance | $115.58 |
| Mortgage insurance | $140.11 |
| Maximum price | $396,273 |
Clear the $500 of other debt and nothing changes — the housing ratio was already the binding one. Double the deposit to $120,000 and the price rises well past $460,000, because mortgage insurance disappears along with the smaller loan.
Questions people ask
They are the long-standing conventional underwriting guidelines: housing costs up to 28% of gross monthly income, and total debt payments up to 36%. They are guidelines, not law. FHA loans commonly allow around 31/43, and the federal qualified-mortgage rules generally cap total debt-to-income at 43%. Both ratios are inputs here because lenders vary and make exceptions.
What you could borrow. It is a ceiling derived from a lender's willingness to lend, which is a different question from what leaves you comfortable. Lenders do not know about childcare, tuition, an unreliable car or how much you want to save. Most people are better off some way below this number.
The monthly payments a lender sees on your credit report: credit cards, car loans, student loans, personal loans, child support. Not utilities, groceries, insurance you pay directly, or your current rent — rent disappears when the mortgage starts.
Two effects stack. It reduces the amount borrowed, and crossing 20% removes mortgage insurance from the monthly cost entirely, which frees budget for a larger loan. The jump at 20% is bigger than the extra cash alone explains.
Only through the interest rate you enter. Credit affects the rate you are offered and whether a lender will stretch its ratios at all, but it does not change the arithmetic once the rate is known.
Working out what you can afford
Mortgage CalculatorMonthly payment with taxes, insurance and HOARelated calculators
An estimate of what a lender might allow, not a pre-approval or an offer. It is a ceiling, not a recommendation.