Mortgage Affordability Calculator
Use this calculator to estimate the maximum mortgage amount you can afford based on your income, debts, and desired monthly payment.
.calculator-container {
font-family: sans-serif;
max-width: 600px;
margin: 20px auto;
padding: 20px;
border: 1px solid #ddd;
border-radius: 8px;
background-color: #f9f9f9;
}
.calculator-container h2 {
text-align: center;
color: #333;
margin-bottom: 15px;
}
.calculator-container p {
text-align: center;
color: #555;
margin-bottom: 25px;
font-size: 0.95em;
}
.form-group {
margin-bottom: 15px;
display: flex;
flex-direction: column;
}
.form-group label {
margin-bottom: 5px;
font-weight: bold;
color: #444;
}
.form-group input {
padding: 10px;
border: 1px solid #ccc;
border-radius: 4px;
font-size: 1em;
}
.calculator-container button {
display: block;
width: 100%;
padding: 12px 15px;
background-color: #007bff;
color: white;
border: none;
border-radius: 5px;
font-size: 1.1em;
cursor: pointer;
transition: background-color 0.3s ease;
}
.calculator-container button:hover {
background-color: #0056b3;
}
.calculator-result {
margin-top: 25px;
padding: 15px;
border: 1px solid #e0e0e0;
border-radius: 5px;
background-color: #fff;
text-align: center;
font-size: 1.1em;
font-weight: bold;
color: #333;
}
.calculator-result span {
color: #28a745;
}
function calculateMortgageAffordability() {
var annualIncome = parseFloat(document.getElementById("annualIncome").value);
var existingMonthlyDebt = parseFloat(document.getElementById("existingMonthlyDebt").value);
var downPayment = parseFloat(document.getElementById("downPayment").value);
var interestRate = parseFloat(document.getElementById("interestRate").value);
var loanTermYears = parseFloat(document.getElementById("loanTermYears").value);
var maxPitiPercentage = parseFloat(document.getElementById("maxPitiPercentage").value);
var maxTotalDebtPercentage = parseFloat(document.getElementById("maxTotalDebtPercentage").value);
var resultDiv = document.getElementById("result");
resultDiv.innerHTML = ""; // Clear previous results
// Validate inputs
if (isNaN(annualIncome) || annualIncome <= 0 ||
isNaN(existingMonthlyDebt) || existingMonthlyDebt < 0 ||
isNaN(downPayment) || downPayment < 0 ||
isNaN(interestRate) || interestRate <= 0 ||
isNaN(loanTermYears) || loanTermYears <= 0 ||
isNaN(maxPitiPercentage) || maxPitiPercentage <= 0 ||
isNaN(maxTotalDebtPercentage) || maxTotalDebtPercentage <= 0) {
resultDiv.innerHTML = "Please enter valid positive numbers for all fields.";
return;
}
var monthlyIncome = annualIncome / 12;
var monthlyInterestRate = (interestRate / 100) / 12;
var loanTermMonths = loanTermYears * 12;
// Calculate maximum allowed PITI (Principal, Interest, Taxes, Insurance)
var maxAllowedPiti = monthlyIncome * (maxPitiPercentage / 100);
// Calculate maximum allowed total debt payments
var maxAllowedTotalDebt = monthlyIncome * (maxTotalDebtPercentage / 100);
// Calculate maximum allowed mortgage payment (P&I only) considering total debt
var maxAllowedPi = maxAllowedTotalDebt – existingMonthlyDebt;
// Determine the more restrictive P&I payment limit
var maxMonthlyPiPayment = Math.min(maxAllowedPiti, maxAllowedPi);
// If the maximum allowed PI payment is negative, it means existing debt exceeds the total debt limit
if (maxMonthlyPiPayment 0) {
// Formula for loan payment: M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1]
// Rearranged for P: P = M [ (1 + i)^n – 1] / [ i(1 + i)^n ]
maxLoanAmount = maxMonthlyPiPayment * (Math.pow(1 + monthlyInterestRate, loanTermMonths) – 1) / (monthlyInterestRate * Math.pow(1 + monthlyInterestRate, loanTermMonths));
} else {
// If interest rate is 0, the loan amount is simply the monthly payment multiplied by the number of months
maxLoanAmount = maxMonthlyPiPayment * loanTermMonths;
}
// Calculate total affordable home price
var affordableHomePrice = maxLoanAmount + downPayment;
resultDiv.innerHTML = "Your estimated maximum affordable home price is:
$" + affordableHomePrice.toFixed(2).replace(/\d(?=(\d{3})+\.)/g, '$&,') + "";
resultDiv.innerHTML += "
(This includes your down payment of $" + downPayment.toFixed(2).replace(/\d(?=(\d{3})+\.)/g, '$&,') + ")";
resultDiv.innerHTML += "
Maximum estimated monthly Principal & Interest payment: $" + maxMonthlyPiPayment.toFixed(2).replace(/\d(?=(\d{3})+\.)/g, '$&,') + "";
resultDiv.innerHTML += "
Maximum estimated loan amount: $" + maxLoanAmount.toFixed(2).replace(/\d(?=(\d{3})+\.)/g, '$&,') + "";
}
Understanding Mortgage Affordability
Determining how much house you can afford is a crucial step in the home-buying process. It's not just about qualifying for a loan; it's about ensuring the mortgage payment fits comfortably within your budget for the long term. This mortgage affordability calculator helps you estimate your borrowing power based on key financial factors.
Key Factors in Mortgage Affordability:
- Annual Gross Income: This is your total income before taxes and deductions. Lenders use this as a primary indicator of your ability to repay a loan.
- Existing Monthly Debt Payments: This includes all recurring monthly obligations like car loans, student loans, personal loans, and minimum credit card payments. These debts reduce the amount of income available for a mortgage.
- Down Payment: The amount of cash you pay upfront. A larger down payment reduces the loan amount needed and can improve your chances of approval and get you better interest rates.
- Estimated Annual Interest Rate: The percentage charged by the lender on the loan amount. Higher interest rates mean higher monthly payments and a larger overall cost for the loan.
- Loan Term (Years): The duration over which you'll repay the mortgage. Common terms are 15, 20, or 30 years. Shorter terms have higher monthly payments but less interest paid over time.
- Maximum PITI as % of Gross Income: This is a common lender guideline (often around 28%). PITI stands for Principal, Interest, Taxes, and Insurance. It represents the total monthly housing cost. Lenders assess if this total is a manageable percentage of your income. Property taxes and homeowner's insurance vary by location and property type.
- Maximum Total Debt as % of Gross Income: Another important lender guideline (often around 36% to 43%, known as the "debt-to-income ratio" or DTI). This considers your total monthly debt obligations (including the estimated PITI) relative to your gross income. A lower DTI generally indicates better loan eligibility.
How the Calculator Works:
The calculator first determines your maximum allowed monthly housing payment (PITI) and your overall maximum monthly debt payments based on the percentages you provide. It then subtracts your existing monthly debt payments from the overall maximum to find the maximum amount you can allocate to your mortgage's Principal and Interest (P&I). Using this P&I limit, along with the interest rate and loan term, the calculator computes the maximum loan amount you can borrow. Finally, it adds your down payment to this loan amount to estimate your total affordable home purchase price.
Example Scenario:
Let's say you have:
- Annual Gross Income: $90,000
- Existing Monthly Debt Payments: $400
- Down Payment: $30,000
- Estimated Annual Interest Rate: 6.0%
- Loan Term: 30 Years
- Maximum PITI as % of Gross Income: 28%
- Maximum Total Debt as % of Gross Income: 36%
Based on these figures, the calculator would estimate the maximum affordable home price, the maximum loan amount, and your estimated monthly P&I payment, helping you set a realistic budget for your home search.
Disclaimer: This calculator provides an estimate only. Actual loan approval and terms will depend on the lender's specific underwriting criteria, your credit score, property appraisal, and other factors. It is recommended to consult with a mortgage professional for personalized advice.