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Home Affordability Calculator

How Much House Can I Afford?

Homeownership is a big financial responsibility, and your current financial situation will influence the size of your mortgage. If you’re wondering, “How much house can I afford?” you’re really wondering, “How much mortgage can I afford?” Many factors, such as your credit score, interest rates, closing costs, income and debts, influence the size of your loan. 

We’re here to make it simple for you. Use our home affordability calculator to determine how much home you can afford based on your current financial situation.

How much home can I afford?

Buying a house requires a budget. You can only afford to spend so much on your monthly mortgage payments. Your loan amount and down payment will determine how much of a home you can afford, but a lender must first determine how much risk they’re willing to take on. Your home affordability depends on many factors, such as your income, debt-to-income (DTI) ratio, credit score and interest rates at the time. 

Knowing your mortgage loan amount can help you determine how much you can afford to pay for a house. You can use our mortgage payment calculator to help you determine how much your mortgage will cost you based on the purchase price, loan terms, interest rate and down payment, but before you determine your monthly payments, you must figure out how much home you can afford in the first place.

Home Affordability Calculator

A home affordability calculator can help you build a better budget when shopping for a home. While the calculator can’t tell you how much you’ll be approved for when taking out a loan, it can give you an estimate that determines whether you’ll qualify for a loan and how much you’ll be able to pay for a house.

How We Can Help You Afford a Home

Finding the right home loan for you can help reduce your mortgage costs over the life of the loan. Unfortunately, many first-time home buyers don’t realize how many options they have. We can help you purchase your new home by ensuring you find the right loan for your needs. 

Apply For a Home Loan Today!

Wondering if you’re ready to purchase a home? Take advantage of our financial counseling services to help you determine a home-buying budget and find the right mortgage for you and your family.

Frequently Asked Questions

Our house affordability calculator allows you to estimate how much home you can afford and your estimated monthly mortgage payments based on key financial factors like your income, debt obligations, interest rate, insurance and property taxes.

To use the home affordability calculator and discover how much home you can afford, simply enter the information requested. First, let’s go over a few of the fields to help you understand the types of information you need to get started.

Loan & Borrower Info

The Loan & Borrower Info tab gives the calculator information about your income, debt obligations, down payment and loan terms like the number of years and interest rate to predict how much home you can afford.

  • Annual gross income: You can calculate your home affordability by income by sharing your annual gross income. This is the amount you earn per year before taxes. You can find this information on your pay stubs or tax returns to give you a more accurate number.
  • Monthly debt payments: Your monthly debt payments include items like credit card payments, loans like car loans, student loans, existing mortgages and any other debt you pay on a monthly basis. It doesn’t include regular monthly bills like your electric, gas or internet bills.
  • Maximum payment: Your maximum payment is the maximum monthly mortgage payment you can afford. You can enter this information by considering your income versus monthly costs and finding a figure you’re comfortable paying every month as your mortgage payment.
  • Down payment: Your down payment is the amount you put down on a home. The higher your down payment, the less you’ll need to borrow, so putting down more upfront can increase your home affordability.
  • Term (years): Your term is your loan term dictating how many years you have to pay off your mortgage loan. Terms vary by lender, bank or financial institution, but you can typically choose a 15- or 30-year loan term.
  • Interest rate: The interest rate is the cost of borrowing from a lender and varies by location and borrower credit score while fluctuating regularly based on market conditions.

Taxes & Insurance

Taxes and insurance refer to yearly costs that may be rolled up into your monthly mortgage payment or paid upfront, depending on your needs. Common taxes and insurance borrowers are responsible for include the following:

  • Property tax (yearly): Property tax is a fee based on the value of your property. These taxes are paid at the state and local levels to fund local initiatives like schools and community projects. You can find your property tax by searching for the current rates in your city, as they typically vary by county.
  • Homeowners insurance (yearly): Homeowners insurance ensures you’re covered in case of damage to the property and will prevent you from paying out of pocket for repairs. Most lenders require homeowners insurance to protect their investors, but how much you pay depends on location and home value.
  • Monthly HOA fee: A homeowners association fee is tied to new and high-end communities and condos to cover the costs of various community amenities like pools, garbage pick up and snow removal. HOA costs vary by location but can range from a few hundred to a few thousand dollars a month, depending on the community.


Assumptions compare your income to various types of debt, including existing debt and future debt from your mortgage, to ensure you can repay your mortgage on a monthly basis.

  • Debt-to-income ratio: Your debt-to-income (DTI) ratio compares your gross monthly income to your debts to ensure you can afford to repay your mortgage with your existing debts. Typically, lenders like to see a DTI of 36% or lower.
  • Housing ratio: Your housing ratio compares your monthly mortgage payment to your gross monthly income to ensure you can afford to pay your mortgage every month. Lenders typically like to see a housing ratio of 28% or lower.

The two top factors that impact your home affordability are your income and debts. The more debt you have, the less you have for your mortgage. Your debt-to-income ratio is the percentage of monthly gross income that goes toward paying your debts, and the lower your percentage, the more you can afford to pay for a home.

However, your income and debts aren’t the only factors lenders review to ensure you can afford a mortgage for a certain amount. Your credit score can impact your interest rate; the higher your score, the lower your interest rate might be and the less you’ll pay over the life of the loan.

Additionally, upfront payments like down payments effectively reduce how much you’ll need to borrow, which can increase how much home you can afford. Simply put, a higher down payment means a lower loan amount and lower monthly payments.

And finally, there are additional costs to homeownership many first-time borrowers don’t realize, such as property taxes, insurance and closing costs. To give you a better idea of your costs, you can use our closing costs calculator.

Lenders use the 28/36 rule to determine your home affordability and whether you qualify for a loan. The 28/36 rule refers to the front-end and back-end debt-to-income ratio. The front-end ratio compares your monthly house expenses to your gross monthly income, stating that your household expenses should not exceed 28% of your income. Meanwhile, the back-end ratio states that no more than 36% of your income should go towards paying your debts, including things like your mortgage, car loan, credit card payments and homeowners association fees.

Buying a home is a big investment, but it’s well worth it because property typically appreciates in value. Still, you don’t want to overburden yourself with debt. Here are a few tips to help you purchase an affordable home:

  • Create a budget: Creating a budget by comparing your income to expenses is crucial because it helps you see how much is left over for paying off your mortgage every month.
  • Get pre-approved for a mortgage: Getting pre-approved for a mortgage can help you determine how much home you can afford based on your current financial situation. However, it’s worth noting that getting pre-approved doesn’t necessarily guarantee your mortgage application will be accepted, or you’ll qualify for the same amount.
  • Consider loan options: Different loan options may appeal to different borrowers. For instance, if you want low or no down payments and qualify, you may benefit from VA, FHA and USDA loans. You can also find credit union home loans, which tend to offer lower rates for members.
  • Research different homes and areas: Home prices vary by location, so researching different areas can help you find more affordable homes requiring lower loan amounts to make purchasing a home more affordable.

Have more questions?

Chat with us online or stop by a local branch to talk with one of our experts.