Common question
How much house can I afford?
Affordability starts as a monthly budget. This page turns the income, debts, down payment, rate, taxes, and insurance you enter into a home price that fits that budget.
The result is an estimate from those numbers. A lender can approve more or less after looking at credit, cash reserves, the property, and the loan program.
You can afford $399,038 on the monthly budget of $2,800.
Compare scenarios
What if your income, debts, or down payment change?
How we calculated this
The monthly housing budget is the lower of two common planning ratios: a share of gross income for housing, and a share of gross income for all debts. The calculator searches for the highest home price whose principal, interest, taxes, insurance, PMI, and HOA fit in that budget.
What does this mean?
With about $2,800.00 available for housing each month, an estimated purchase price is $399,038. A lender’s approval can be higher or lower.
Your assumptions
Edit assumptions- Annual income
- $120,000
- Monthly debt
- $250.00
- Housing ratio
- 28%
- Total-debt ratio
- 36%
- Interest rate
- 6.50%
- Loan term
- 30 years
- Property tax
- 1.10%
This calculator provides an estimate for informational purposes. Actual mortgage payments, taxes, insurance, PMI, fees, and lender terms may vary.
How the estimate is calculated
Gross monthly income times the housing ratio is one limit. Gross monthly income times the total-debt ratio, minus the debts you already pay, is the other. The tighter of the two is the housing budget.
The page then searches for the highest price whose principal, interest, taxes, insurance, PMI, and HOA still fit in that budget. PMI is included only when the loan is above 80% of the price.
Open the Home Affordability Calculator · How this calculator works · How much house can you afford?
Questions
Is 28% and 36% a rule a lender must follow?
No. Those are the planning defaults on this page. You can change both ratios. A lender uses its own guidelines.
Which debts should I include?
Include car, student, and card payments you already make. Do not include the mortgage you have not taken yet.
Why did the price stop where it did?
Either the housing share of income or the total-debt share set the limit. The calculator says which one.
Does the down payment change the price?
Yes. Cash you put down lowers the loan and can remove PMI once the loan is 80% of the price or less.