Mortgage Affordability Calculator
Estimate a maximum home price from income, debts, mortgage costs, and debt-to-income limits.
How mortgage affordability is estimated
The calculator compares two monthly limits. The housing limit is gross monthly income multiplied by the housing debt-to-income ratio. The total-debt limit is gross monthly income multiplied by the total DTI ratio, minus existing monthly debt payments. The lower amount becomes the available housing budget.
min(income × housing DTI, income × total DTI − monthly debts)
A binary search then finds the highest home price whose estimated principal, interest, property tax, homeowners insurance, HOA dues, and PMI fit within that budget.
What counts as monthly housing cost
- Mortgage principal and interest based on the selected APR and term.
- Property tax estimated as a percentage of the home price.
- Monthly homeowners insurance and HOA dues.
- PMI when the entered down payment is less than 20% of the estimated price.
Example
A household earning $100,000 gross per year with $500 in monthly debt, $40,000 available for a down payment, a 6.5% mortgage rate, and 28%/36% DTI limits receives an affordability estimate that includes property taxes, insurance, and PMI—not just principal and interest.
DTI limits are assumptions, not approvals
The default 28% housing and 36% total-debt ratios are planning assumptions. Lenders may use different limits and also consider credit history, reserves, loan program, employment, property type, and local costs. Change both DTI inputs to model the standards relevant to your situation.
Important limits
This estimate does not guarantee financing and does not include every lender fee, maintenance cost, utility bill, tax adjustment, insurance change, or rate change. Closing costs are shown as a separate cash estimate and are not added to the loan. Confirm taxes, insurance, PMI, and cash requirements with qualified local professionals.
Related calculators
- Mortgage Calculator — calculate payment from a known home price.
- Mortgage Payoff Calculator — compare extra payments on an existing loan.
- Salary Calculator — convert gross pay between common periods.
Existing mortgage: compare your current loan with a proposed new rate, term, closing costs, and holding period in the Mortgage Refinance Calculator.