Home Affordability
Estimate how much house you can afford based on your income, monthly debts, and down payment.
- NOT FINANCIAL ADVICE
- EDUCATIONAL USE ONLY
- ESTIMATES BASED ON DTI RATIOS
- LENDER CRITERIA MAY VARY
$
$
Include car loans, student loans, and credit card minimums.
$
%
Recommended Home Price
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Based on a moderate 36% Debt-to-Income ratio.
Affordability Tiers
Conservative (28%)
$0
Very Safe
Moderate (36%)
$0
Standard
Aggressive (43%)
$0
Lender Limit
Monthly P&I Payment
$0
Max Total Debt/Mo
$0
Understanding Home Affordability
How much you can 'afford' is a personal decision that depends on your income, debts, and how much you're willing to spend each month on housing.
The 28/36 Rule
Many financial advisors and lenders use the 28/36 rule as a guideline:
- 28% Front-End Ratio: Your total housing costs (mortgage, tax, insurance) should not exceed 28% of your gross monthly income.
- 36% Back-End Ratio: Your total debt payments (housing costs + car loans, credit cards, etc.) should not exceed 36% of your gross monthly income.
Factors That Change Affordability
- Interest Rates: Even a 1% increase in rates can reduce your purchasing power by tens of thousands of dollars.
- Down Payment: A larger down payment reduces your loan amount and monthly interest costs.
- Local Taxes: High-tax areas reduce the amount of your monthly payment that can go toward the loan principal.