House Affordability Calculator
Free house affordability calculator: how much house you can afford with your income, debts and down payment, using the 28/36 rule, taxes, insurance and PMI.
| Principal and interest | |
|---|---|
| Property tax | |
| Insurance | |
| HOA or condo fees | |
| PMI |
No currency is shown on purpose: the figures come out in whatever unit you type in.
What it does
Lenders in the United States usually follow the 28/36 rule: the housing payment, with principal, interest, property tax, insurance, HOA fees and PMI, should stay under 28% of your gross monthly income, and all your debts together under 36%. The calculator finds the highest home price that meets both limits with your down payment, rate and term. You can change the two percentages to match your lender.
How to use it
- Type your annual gross income, your monthly debt payments and the down payment you have.
- Type the interest rate and the term, and the property tax, insurance and fees of the area.
- Read the home price you can afford and how the monthly payment is made up.
The arithmetic runs in your browser. Nothing you type is sent anywhere and nothing is stored, so you can use these with real numbers.
Frequently asked questions
What is the 28/36 rule?
A guideline used by many US lenders: spend at most 28% of your gross monthly income on housing and at most 36% on all debts, including car loans, student loans and credit cards. Some loan programs accept higher ratios, which is why both numbers can be changed.
What is PMI?
Private mortgage insurance, which lenders usually require when the down payment is less than 20% of the price. It typically costs between 0.3% and 1.5% of the loan per year and stops once you own 20% to 22% of the home.
Why does a bigger down payment raise the price so much?
Because every unit of down payment adds to the price without adding to the monthly payment, and above 20% it also removes the PMI. The interest rate matters a lot too: one point less raises the loan you can carry by roughly 10%.
Is this what the bank will lend me?
It is an estimate. The lender also looks at your credit score, savings, job history and the loan program, and closing costs are not included. Use it to set a price range before you talk to a lender.
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Wikipedia — Debt-to-income ratio
Wikipedia — Lenders mortgage insurance