Mortgage Affordability Calculator — How Much House Can I Afford?

This free mortgage affordability calculator answers the first question every buyer asks: how much house can I afford? Enter your gross income, existing monthly debts, down payment, interest rate, and estimated taxes and insurance, and it returns the maximum home price your finances comfortably support — along with the monthly payment, loan amount, and principal-and-interest breakdown behind it. It works backwards through the same 28/36 debt-to-income rule that mortgage lenders use when they underwrite an application, so the figure you see is grounded in how approval actually happens.

Get your number before you talk to a bank, before you tour homes, and before you fall for a property that sits above your budget. The calculator also tells you which of the two ratio limits is capping your result — the practical clue for whether raising income or clearing debt would unlock more house.

What Is a Mortgage Affordability Calculator?

A mortgage affordability calculator is a home-buying planning tool that starts from your financial profile and solves for the maximum home price you can responsibly buy. A standard mortgage payment calculator does the opposite — it takes a loan amount and returns the monthly cost. This home affordability calculator solves for the loan amount itself, then adds your down payment to reveal the total purchase price your income and debts support.

The engine is the debt-to-income (DTI) ratio — the same framework used by Fannie Mae, FHA, VA, and conventional lenders when underwriting. As the Consumer Financial Protection Bureau explains, lenders lean on DTI because it measures directly whether your income can carry the proposed payment alongside the debts you already have.

How to Use This Home Affordability Calculator

1. Gross annual income — total household income before tax. Combine both incomes for a joint application.
2. Existing monthly debt payments — every current minimum: car loans, student loans, credit card minimums, personal loans. Do not include your current rent.
3. Down payment — the cash you plan to put toward the purchase.
4. Interest rate (%) — use a current 30-year fixed estimate from a lender or rate-comparison site.
5. Loan term — 30 years is standard; a 15-year loan carries a higher payment but far less total interest.
6. Monthly tax + insurance — property tax and homeowners insurance combined; $200–$500 a month is typical across many markets.
7. Click Calculate Affordability — maximum home price, monthly payment, loan amount, and principal-and-interest appear instantly.

What Percentage of Income Should Your Mortgage Be? The 28/36 Rule

The most important thing this calculator settles is what share of your income a mortgage should take. The lender-standard answer is the 28/36 rule, a two-part debt-to-income guideline:

• 28% front-end ratio — your total housing payment (principal, interest, property taxes, and insurance, together called PITI) should not exceed 28% of gross monthly income.
• 36% back-end ratio — all monthly debt payments combined, including the new mortgage, should not exceed 36% of gross monthly income.

The back-end limit is why existing car loans, student loans, and credit card minimums shrink how much mortgage you can add on top. This calculator applies both limits and reports whichever produces the safer, lower payment — exactly the approach a lender's underwriter takes. Some programs allow more headroom: FHA loans can approve up to 43% back-end DTI, and certain VA programs go higher, so adjust your reading for the loan type you are pursuing.

How Much House Can I Afford? — Income-Based Examples

The most common version of the question changes with income. Some indicative ranges at current interest rates, assuming 20% down and no other debts:

• At $70k a year — the 28% front-end limit allows roughly $1,633 a month for housing, which after taxes and insurance typically supports a home in the $200,000–$240,000 range depending on rate and location.
• At $80k a year — the front-end limit is about $1,867 a month, usually supporting $230,000–$280,000 in purchase price at current rates.
• For a $300k house — most buyers need a gross household income of at least $75,000–$90,000 under the 28/36 rule, assuming a standard down payment and modest existing debt.

These are ballparks — enter your exact inputs above for a figure tailored to your situation. Rates, existing debt, and down payment size all shift the result meaningfully.

How Your Down Payment Changes Everything

Affordability is not driven by income alone — your down payment is an equally powerful lever. A larger down payment lowers the loan you need, which lowers the monthly payment, which can push your price ceiling higher without a raise. Three extra benefits make it worth stretching for:

• Eliminates PMI — putting down 20% or more removes private mortgage insurance, typically saving $100–$200 a month.
• Better interest rates — a lower loan-to-value ratio often qualifies for slightly better mortgage pricing.
• Stronger DTI — a bigger down payment improves your ratios, making approval more likely and buying power greater.

Model a few scenarios above: even $10,000–$20,000 more upfront often raises the affordable home price by considerably more than the extra cash itself. To time that saving, pair this with our savings goal calculator, and use our compound interest calculator to see how your down-payment fund can grow while you wait.

Hidden Costs That Change Your Real Budget

The mortgage payment is only part of the picture. A budget that ignores the full cost of ownership can strain a household inside the first year. Factor in:

• Property taxes — vary sharply by state and municipality; in high-tax areas this alone can add $400–$800 a month.
• Homeowners insurance — required by every lender, typically $100–$200 a month.
• Maintenance and repairs — planners suggest budgeting about 1% of home value a year ($200 a month on a $240,000 home).
• HOA fees — condos and many communities charge $150–$500 a month.
• Closing costs — usually 2–5% of the purchase price, due at closing.

For the payment side of any specific loan amount, run our loan calculator; if you are also weighing a vehicle purchase before buying, our auto loan calculator shows how that monthly payment eats into your DTI. Explore every planning tool in our free tools hub. As the Investopedia mortgage guide notes, buyers who account for the full cost of ownership up front are far less likely to become house-poor after closing.

Frequently Asked Questions