House Affordability Calculator
Estimate how much house you can afford from your income, monthly debts, down payment, rate, property tax and insurance, using the 28/36 rule. Example: a $100,000 income with $500 in monthly debts and $60,000 down affords a home of about $357,500 at 6.5%.
Show steps
How to use the House Affordability Calculator
- Enter your gross income, monthly debts and down payment.
- Enter the mortgage rate, term, property tax rate and insurance.
- Press Calculate for the price range, loan and monthly payment.
Formula and method
Maximum housing payment = the lower of 28% of gross monthly income and 36% of gross monthly income minus other debts. Then price = (payment – insurance + down payment x k) / (k + tax rate / 12), where k = i / (1 – (1 + i)^-n) is the monthly loan factor.
Worked example
| Step | Result |
|---|---|
| Monthly income | $8,333.33 |
| 28% limit | $2,333.33 |
| 36% limit minus debts | $2,500.00 |
| Housing budget (lower) | $2,333.33 |
| Home price (6.5%, 30 years, $60,000 down) | about $357,500 |
Income and home price at 6.5%, 30 years, 20% down, no other debt
| Income | Home price (approx) |
|---|---|
| $50,000 | $174,000 |
| $75,000 | $272,000 |
| $100,000 | $370,000 |
| $150,000 | $565,000 |
| $200,000 | $760,000 |
Beyond the calculator
Lenders also check credit score, employment history and savings for closing costs, typically 2% to 5% of the price. Get pre-approved to see your actual rate and limit.
Frequently asked questions
How much house can I afford?
About 28% of gross income for housing and 36% for all debt, adjusted for your down payment and rate.
What is the 28/36 rule?
Housing costs at most 28% of gross income and total debt at most 36%.
How does the down payment change affordability?
A larger down payment raises the price you can afford for the same monthly payment.
Do higher rates lower what I can afford?
Yes. A higher rate raises the payment per dollar borrowed.
What is included in the monthly payment?
Principal, interest, property tax and insurance.
Is this a loan approval?
No. Lenders set the final limit.
Sources
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