Use this calculator to estimate how much home you can afford based on your income, debts, and estimated mortgage costs. Understanding your borrowing capacity is a crucial first step in the home-buying process.
function calculateAffordability() {
var annualIncome = parseFloat(document.getElementById("annualIncome").value);
var monthlyDebt = parseFloat(document.getElementById("monthlyDebt").value);
var downPayment = parseFloat(document.getElementById("downPayment").value);
var interestRate = parseFloat(document.getElementById("interestRate").value);
var loanTerm = parseFloat(document.getElementById("loanTerm").value);
var propertyTaxRate = parseFloat(document.getElementById("propertyTaxRate").value);
var homeInsurance = parseFloat(document.getElementById("homeInsurance").value);
var pmiRate = parseFloat(document.getElementById("privateMortgageInsurance").value);
var resultDiv = document.getElementById("result");
resultDiv.innerHTML = ""; // Clear previous results
// Input validation
if (isNaN(annualIncome) || annualIncome < 0 ||
isNaN(monthlyDebt) || monthlyDebt < 0 ||
isNaN(downPayment) || downPayment < 0 ||
isNaN(interestRate) || interestRate < 0 ||
isNaN(loanTerm) || loanTerm <= 0 ||
isNaN(propertyTaxRate) || propertyTaxRate < 0 ||
isNaN(homeInsurance) || homeInsurance < 0 ||
isNaN(pmiRate) || pmiRate < 0) {
resultDiv.innerHTML = "Please enter valid positive numbers for all fields.";
return;
}
// Lender's Debt-to-Income Ratio (DTI) limits can vary, but common guidelines are:
// Front-end ratio (housing costs): 28% of gross monthly income
// Back-end ratio (all debts): 36% of gross monthly income
var maxHousingPaymentRatio = 0.28;
var maxTotalDebtRatio = 0.36;
var monthlyIncome = annualIncome / 12;
var maxHousingPayment = monthlyIncome * maxHousingPaymentRatio;
var maxTotalDebtPayment = monthlyIncome * maxTotalDebtRatio;
var maxMortgagePayment = maxTotalDebtPayment – monthlyDebt;
// Ensure maxMortgagePayment is not negative
if (maxMortgagePayment < 0) {
maxMortgagePayment = 0;
}
// Determine the actual affordable monthly payment based on the stricter of the two ratios
var affordableMonthlyPayment = Math.min(maxHousingPayment, maxMortgagePayment);
if (affordableMonthlyPayment 80%.
// We need to solve for Loan Amount (P) in the equation:
// affordableMonthlyPayment = P * [ i(1+i)^n ] / [ (1+i)^n – 1] + Taxes + Insurance + PMI
// Where:
// P = Principal Loan Amount
// i = monthlyInterestRate
// n = numberOfMonths
// Taxes = monthlyPropertyTax
// Insurance = monthlyHomeInsurance
// PMI = monthlyPMI
// Let's first calculate the mortgage principal and interest portion of the affordable payment
var pmiRateDecimal = pmiRate / 100;
var estimatedPmiCostPerMonth = 0;
var loanAmountGuess = affordableMonthlyPayment * 1000; // Initial guess for loan amount
var tolerance = 0.01;
var iterations = 0;
var maxIterations = 100;
// Iteratively calculate loan amount considering PMI
do {
estimatedPmiCostPerMonth = (loanAmountGuess * pmiRateDecimal) / 12;
var principalAndInterestPayment = affordableMonthlyPayment – (monthlyPropertyTax * (loanAmountGuess / 100000)) – monthlyHomeInsurance – estimatedPmiCostPerMonth; // Adjust taxes based on current loan guess
if (principalAndInterestPayment tolerance && iterations < maxIterations);
var maxLoanAmount = loanAmountGuess;
// Calculate maximum home price
var maxHomePrice = maxLoanAmount + downPayment;
// Format results
var formattedMaxHomePrice = maxHomePrice.toLocaleString(undefined, { style: 'currency', currency: 'USD' });
var formattedMaxLoanAmount = maxLoanAmount.toLocaleString(undefined, { style: 'currency', currency: 'USD' });
var formattedMonthlyPITI = (affordableMonthlyPayment).toLocaleString(undefined, { style: 'currency', currency: 'USD' });
resultDiv.innerHTML = `
Your Estimated Affordability:
Based on your inputs, the estimated maximum home price you could afford is:
${formattedMaxHomePrice}
This includes your down payment of ${downPayment.toLocaleString(undefined, { style: 'currency', currency: 'USD' })}.
The estimated maximum loan amount you might qualify for is: ${formattedMaxLoanAmount}
This results in an estimated maximum total monthly housing payment (Principal, Interest, Taxes, Insurance, PMI) of approximately: ${formattedMonthlyPITI}
Note: These are estimates. Actual loan approval depends on lender guidelines, credit score, employment history, and other factors. Property taxes and insurance costs can vary significantly.
`;
}
.calculator-container {
font-family: sans-serif;
max-width: 700px;
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 {
color: #555;
line-height: 1.6;
margin-bottom: 20px;
}
.input-section {
display: grid;
grid-template-columns: repeat(auto-fit, minmax(250px, 1fr));
gap: 15px;
margin-bottom: 20px;
}
.form-group {
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;
}
.form-group input:focus {
outline: none;
border-color: #007bff;
box-shadow: 0 0 0 2px rgba(0, 123, 255, 0.25);
}
button {
display: block;
width: 100%;
padding: 12px 20px;
background-color: #007bff;
color: white;
border: none;
border-radius: 5px;
font-size: 1.1em;
cursor: pointer;
transition: background-color 0.3s ease;
}
button:hover {
background-color: #0056b3;
}
.result-section {
margin-top: 25px;
padding: 15px;
border: 1px solid #e0e0e0;
background-color: #fff;
border-radius: 5px;
text-align: center;
}
.result-section h3 {
margin-top: 0;
color: #333;
}
.result-section p {
margin-bottom: 10px;
}