House Affordability Calculator
Calculate how much house you can afford based on your income, debts, down payment, and loan parameters.
Input Parameters
Results
28% Rule for Home Affordability
Lenders generally recommend spending no more than 28% of your gross monthly income on housing expenses (PITI: principal, interest, taxes, insurance). Total debt should not exceed 36–43% of income.
What is the House Affordability Calculator?
The House Affordability Calculator analyzes your income, debts, and down payment to determine the maximum home price you can afford to buy while remaining approved by mortgage underwriters.
How It Works (Algorithm)
Banks look at your Debt-to-Income (DTI) ratio. The "Front-End" ratio dictates that housing costs (Mortgage + Taxes + Insurance) cannot exceed 28% of your gross income. The "Back-End" ratio dictates that all debts combined cannot exceed 36% to 43%. The tool calculates the lower threshold to find your max loan.
$$ \text{Max Payment} = \text{Monthly Gross Income} \times 0.28 $$
The strict Front-End DTI rule for housing expenses.
How to Use It
Input your annual income, your available down payment, and your current monthly debt obligations. The calculator will estimate property taxes and insurance, run the DTI algorithms, and output your absolute maximum target home price.