Mortgage Affordability Calculator

What is Mortgage Affordability Calculator?

Estimate affordable home price from income, debt payments, DTI target, taxes, insurance, PMI, down payment, and mortgage rate.

• Set a home-search budget before viewing properties.
• Test rate increases or debt changes.
• Connect mortgage payment to household cash flow.

Scope and country basis

This page estimates an affordable home price from income, debt, DTI target, non-loan housing costs, down payment, and rate.

It is a household budget tool, not loan approval. Lenders apply local underwriting, credit, documentation, tax, and product rules.

What each input means

Monthly gross income

Money field, formatted in the selected currency.

Monthly debt payments

Money field, formatted in the selected currency.

Target housing DTI

Percentage field: enter 8 for 8%.

Down payment

Money field, formatted in the selected currency.

Annual interest rate

Percentage field: enter 8 for 8%.

Loan term

Number field: enter the value that matches your scenario.

Annual property tax

Money field, formatted in the selected currency.

Annual insurance

Money field, formatted in the selected currency.

Monthly PMI

Money field, formatted in the selected currency.

Formula and interpretation

P&I budget = income x target housing DTI - debt payments - non-loan housing costs. Affordable price = supported loan principal + down payment.

Treat the output as an upper boundary, not a recommendation to spend the maximum.

Key concepts

Housing DTI

Housing cost as a share of gross monthly income.

Debt payments

Existing monthly obligations that reduce mortgage capacity.

Budget ceiling

A calculated upper boundary, not a target.

How to read the result

• If the result is below the target home price, adjust price, down payment, debt, term, or expectations.
• Test a higher rate before committing.
• Keep emergency reserves outside the down payment.

How to use it

1. Enter home price, down payment, rate, term, and housing-cost assumptions.
2. Review payment, total interest, affordability, or rent-vs-buy output.
3. Adjust down payment, term, rate, and holding period to compare household cash flow.
4. Before buying, verify local rules, taxes, insurance, and lender underwriting.

Common mistakes

• Using best-month income.
• Ignoring existing debt.
• Treating lender approval as comfort.

Suggested workflow

1. Find affordability range.
2. Compare mortgage payment methods.
3. Run rent-vs-buy for holding-period context.

Method and review boundary

This calculator runs a local estimate from the inputs and formula shown on this page. It does not retrieve live rules, rates, underwriting decisions, or quotes from banks, tax authorities, insurers, or other providers. Last reviewed: July 24, 2026.

For tax, lending, insurance, retirement, investment, or contract decisions, verify official guidance, the relevant agreement, and a formal quote for your location. Use this result to compare scenarios and prepare questions, not as financial, tax, investment, or legal advice.

Official references and applicability

This is a planning estimate, not a lending decision. Lenders apply their own income, debt, collateral, and policy checks.

• CFPB Loan Estimate Explainer — Consumer Financial Protection Bureau
• People's Bank of China LPR releases — People's Bank of China

Sources checked July 24, 2026. Rules and source pages can change; review them again before formal use.

Notes

• Does not guarantee approval.
• Local lending rules vary.
• Income volatility calls for a lower DTI assumption.

FAQ