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Mortgage Affordability Calculator

The house price two lending ratios allow, and which of them binds. The front-end ratio caps housing alone and the back-end caps all debt, and someone with car and student loans is usually limited by the second.

Also called: how much house can i afford, home affordability.

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years
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House price you can afford
$404,804.68

$404,804.68 with 60,000 down, on a loan of $344,804.68. The binding limit is the front-end ratio, giving a housing payment of $2,800.00 a month.

Loan amount
$344,804.68
Total monthly housing payment
$2,800.00
Principal and interest
$2,293.99
Tax and insurance
$506.01
Which limit binds
front-end
Resulting back-end ratio
33%
How this is calculated

An estimate, not an offer or a guarantee. Projected returns assume the rate you entered holds for the whole term, which no market does.

Method and background

This is what the calculation gives for the numbers you entered. It is an estimate, not advice, and it knows nothing about your situation beyond those numbers. Rules for United States change on a published schedule; the effective date is shown on every rule-based tool.

How this is calculated

Two caps apply at once. The front-end ratio limits the housing payment to a share of gross income; the back-end limits every debt payment together. The lower of the two governs, and which one it is tells you what to fix: front-end binding means you need more income, back-end binding means clearing other debt raises what you can buy. The housing payment then has to cover tax and insurance as well as principal and interest, which is why the loan is smaller than the raw payment suggests.

the affordable housing payment is the lower of the two ratio caps; the price follows from it
I
Gross annual income (currency)
D
Other monthly debt (currency)

Worked examples

Each of these is asserted on every build. If a change to the engine ever moved one of these answers, the build would fail before the page could print it.

a hundred and twenty thousand income

Gross annual income
$120,000.00
Other monthly debt payments
$500.00
Down payment available
$60,000.00
Interest rate
7%
Term
30 years
Front-end ratio cap
28%
Back-end ratio cap
36%
Property tax and insurance, as a share of price a year
1.5%

House price you can afford$404,804.68

28% of 10,000 is 2,800 against 36% less 500, which is 3,100

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heavy other debt makes the back-end bind

Gross annual income
$120,000.00
Other monthly debt payments
$1,500.00
Down payment available
$60,000.00
Interest rate
7%
Term
30 years
Front-end ratio cap
28%
Back-end ratio cap
36%
Property tax and insurance, as a share of price a year
1.5%

House price you can afford$316,231.00

boundary: the switch this page exists to show

Open this example

Method and limits

What it assumes

  • Property tax and insurance as a share of price, which varies enormously by location.
  • No mortgage insurance, which applies below twenty percent down.

What it deliberately does not model

  • Association dues, flood insurance and maintenance are real housing costs and are excluded.
  • Lender overlays and credit score move the actual approval.

Formula version 1.0.0 · definition 1.0.0 · United States · Report a problem with this calculator

Frequently asked questions

Which ratio is limiting me?
This page says which. If the back-end ratio binds, paying off a car loan raises your buying power directly; if the front-end binds, only more income or a bigger deposit helps.