Mortgage Affordability Calculator | Estimate the Home Price You Can Afford
Compare your income, monthly debt, and down payment against the mortgage payment and home price that may fit your budget.
Who this is for
This calculator is designed for home shoppers comparing purchase prices, monthly costs, and financing scenarios before they make an offer. It is especially helpful if you want to estimate a realistic home budget based on your income and existing debt obligations.
How this mortgage affordability calculator works
Use this calculator to estimate the maximum home price that may fit your monthly cash flow using common housing debt guidelines and your current financing assumptions.
Formula: The tool compares your monthly gross income to a target housing payment using a 28% housing ratio and a 36% total debt ratio, then solves the mortgage amount implied by the remaining monthly payment.
Assumptions: This model assumes a fixed-rate mortgage, a standard monthly loan schedule, and a property tax and insurance estimate based on your inputs. It does not include all lender fees, HOA changes, or special loan programs.
Worked example: A household earning $120,000 a year, carrying $600 in monthly debt, and putting down $40,000 on a 30-year mortgage at 6.5% may qualify for a home price around the $380,000 to $430,000 range depending on taxes and insurance.
- Annual income: Your gross household income before taxes.
- Monthly debt: Car payments, student loans, credit cards, and other recurring obligations.
- Down payment: Cash you contribute toward the home purchase.
- Mortgage rate: The estimated interest rate on the loan.
- Max home price: The purchase price that aligns with a sustainable monthly housing payment.
What the result means
The affordability estimate gives a practical ceiling for a home purchase based on your income and debt obligations. It helps you compare various offers and decide whether a monthly mortgage payment leaves room for savings and lifestyle flexibility.
Related calculators
Budget planner for checking monthly cash flow before a purchase, Loan calculator for reviewing total mortgage cost under a fixed repayment schedule.
Frequently asked questions
- Is this a lender preapproval? No. It is an affordability estimate using standard debt-to-income assumptions and does not replace a formal mortgage qualification review.
- Are taxes and insurance included? Yes, using the rates you enter, but lender fees, maintenance, and utilities are not included unless you add them manually.
Why lenders look at your debt-to-income ratio
Mortgage affordability isn't just about the home price, it's about how much of your monthly income is already committed to other debts. Lenders typically cap total housing and debt payments at around 36-43% of gross monthly income, so an auto loan or student loan payment can reduce the home price you qualify for even with strong income.
Don't forget property taxes, homeowners insurance, and, if your down payment is under 20%, private mortgage insurance (PMI). These recurring costs are often bundled into the monthly payment through an escrow account and can add hundreds of dollars a month beyond principal and interest alone.
- Get pre-approved before house hunting: A lender's actual number can differ from a rough estimate based on credit and debt details.
- Leave room for maintenance: Homeownership costs don't stop at the mortgage payment; budget separately for repairs.
- Watch rate locks: Rates can shift between pre-approval and closing, changing your affordable price range.
Creator & reviewers
Creator persona
- Avery BennettPersonal finance & everyday budgeting
Reviewer personas
- Devon ShawFormula & assumptions review
- Sage MitchellClarity & usability review