.calculator-container {
font-family: Arial, sans-serif;
border: 1px solid #ddd;
padding: 20px;
border-radius: 8px;
max-width: 600px;
margin: 20px auto;
background-color: #f9f9f9;
}
.calculator-container h2 {
text-align: center;
color: #333;
margin-bottom: 20px;
}
.input-group {
margin-bottom: 15px;
display: flex;
flex-direction: column;
}
.input-group label {
margin-bottom: 5px;
font-weight: bold;
color: #555;
}
.input-group input {
padding: 10px;
border: 1px solid #ccc;
border-radius: 4px;
box-sizing: border-box; /* Include padding and border in the element's total width and height */
font-size: 1em;
}
.calculator-container button {
display: block;
width: 100%;
padding: 12px 20px;
background-color: #4CAF50;
color: white;
border: none;
border-radius: 4px;
cursor: pointer;
font-size: 1.1em;
margin-top: 20px;
transition: background-color 0.3s ease;
}
.calculator-container button:hover {
background-color: #45a049;
}
#result {
margin-top: 25px;
padding: 15px;
background-color: #e8f5e9;
border: 1px solid #a5d6a7;
border-radius: 4px;
text-align: center;
font-size: 1.2em;
color: #2e7d32;
font-weight: bold;
display: none; /* Hidden by default */
}
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 propertyTax = parseFloat(document.getElementById("propertyTax").value);
var homeInsurance = parseFloat(document.getElementById("homeInsurance").value);
var pmi = parseFloat(document.getElementById("pmi").value);
var resultDiv = document.getElementById("result");
resultDiv.style.display = 'block';
// Validate inputs
if (isNaN(annualIncome) || isNaN(monthlyDebt) || isNaN(downPayment) || isNaN(interestRate) || isNaN(loanTerm) || isNaN(propertyTax) || isNaN(homeInsurance) || isNaN(pmi)) {
resultDiv.innerHTML = "Please enter valid numbers for all fields.";
return;
}
// Lender Debt-to-Income (DTI) ratios
var maxDtiHousing = 0.28; // Typically 28% for housing PITI
var maxDtiTotal = 0.36; // Typically 36% for total debt
var monthlyIncome = annualIncome / 12;
// Calculate maximum allowed monthly housing payment (Principal, Interest, Taxes, Insurance – PITI)
var maxMonthlyHousingPayment = (monthlyIncome * maxDtiHousing) – monthlyDebt;
// Calculate maximum allowed total monthly debt payment
var maxMonthlyTotalPayment = monthlyIncome * maxDtiTotal;
// We'll use the more conservative of the two to determine affordability
var targetMonthlyPayment = Math.min(maxMonthlyHousingPayment, maxMonthlyTotalPayment – monthlyDebt);
if (targetMonthlyPayment <= 0) {
resultDiv.innerHTML = "Based on your income and existing debts, you may not qualify for a mortgage at this time or with these estimates.";
return;
}
// Calculate monthly PITI components
var monthlyPropertyTax = propertyTax / 12;
var monthlyHomeInsurance = homeInsurance / 12;
var monthlyPmi = pmi / 12; // PMI is often calculated annually but paid monthly
var monthlyInterestAndPrincipalPayment = targetMonthlyPayment – monthlyPropertyTax – monthlyHomeInsurance – monthlyPmi;
if (monthlyInterestAndPrincipalPayment 0 && numberOfPayments > 0) {
var factor = Math.pow(1 + monthlyInterestRate, numberOfPayments);
principalAmount = monthlyInterestAndPrincipalPayment * (factor – 1) / (monthlyInterestRate * factor);
} else if (monthlyInterestRate === 0) { // Handle 0% interest rate case
principalAmount = monthlyInterestAndPrincipalPayment * numberOfPayments;
}
var maxMortgageAmount = principalAmount;
if (maxMortgageAmount < 0) {
resultDiv.innerHTML = "Calculation resulted in a negative loan amount. Please check your input values.";
return;
}
// Display the result
resultDiv.innerHTML = "Estimated Maximum Mortgage Amount: $" + maxMortgageAmount.toFixed(2);
}
Understanding Mortgage Affordability
Determining how much house you can afford is a crucial step in the home-buying process. Lenders use various metrics to assess your borrowing capacity, with Debt-to-Income (DTI) ratios being a primary factor. This calculator helps estimate the maximum mortgage amount you might qualify for based on common lending guidelines.
Key Factors Considered:
Annual Household Income: The total gross income of all borrowers. Lenders look at your ability to repay the loan.
Existing Monthly Debt Payments: This includes car loans, student loans, credit card minimum payments, and any other recurring debts (excluding current rent or mortgage if not yet purchased). Lenders want to ensure you can manage new debt on top of existing obligations.
Down Payment: The amount of cash you're putting towards the purchase price. A larger down payment reduces the loan amount needed and can improve loan terms.
Interest Rate: The annual interest rate on the mortgage loan. Higher rates mean higher monthly payments for the same loan amount.
Loan Term: The duration of the mortgage, typically 15 or 30 years. Longer terms result in lower monthly payments but more interest paid over time.
Property Taxes: Annual taxes levied by local governments, paid monthly as part of your mortgage escrow.
Homeowners Insurance: Annual insurance to protect against damage or loss, also typically paid monthly through escrow.
Private Mortgage Insurance (PMI): Required by lenders if your down payment is less than 20% of the home's purchase price. It protects the lender, not you.
How the Calculator Works:
This calculator estimates your maximum affordable monthly housing payment (Principal, Interest, Taxes, and Insurance – PITI) based on typical DTI limits. A common guideline is that your total housing expenses (PITI) should not exceed 28% of your gross monthly income, and your total debt payments (including housing) should not exceed 36% of your gross monthly income.
The calculator first determines the maximum total monthly debt payment you can handle. It then subtracts your existing monthly debt payments to find the maximum allowable monthly payment for housing (PITI). From this PITI, it subtracts your estimated monthly property taxes, homeowners insurance, and PMI to determine the maximum monthly payment available for the principal and interest of the mortgage loan.
Finally, using the standard mortgage payment formula, it calculates the largest loan amount you could borrow given that maximum principal and interest payment, the specified interest rate, and loan term.
Disclaimer: This calculator provides an *estimate* only. Actual loan approval amounts and terms are determined by individual lenders based on a comprehensive review of your credit history, income verification, assets, liabilities, and other underwriting criteria. Consult with a mortgage professional for personalized advice.
Using the calculator with these inputs would estimate your maximum affordable mortgage amount, considering lender DTI ratios and all associated housing costs.