Mortgage Affordability Calculator
This calculator helps you estimate how much house you can afford based on your income, debts, and desired down payment.
.calculator-container {
font-family: Arial, sans-serif;
border: 1px solid #ccc;
padding: 20px;
border-radius: 8px;
max-width: 500px;
margin: 20px auto;
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text-align: center;
margin-bottom: 20px;
color: #333;
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.calculator-container p {
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margin-bottom: 30px;
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line-height: 1.6;
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margin-bottom: 15px;
display: flex;
align-items: center;
gap: 10px;
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.calculator-form label {
flex: 1;
min-width: 150px;
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.calculator-form input[type="number"] {
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border-radius: 4px;
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transition: background-color 0.3s ease;
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.calculator-form button:hover {
background-color: #45a049;
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.calculator-result {
margin-top: 25px;
padding: 15px;
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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 resultElement = document.getElementById("result");
// Basic validation
if (isNaN(annualIncome) || isNaN(monthlyDebt) || isNaN(downPayment) || isNaN(interestRate) || isNaN(loanTerm)) {
resultElement.innerHTML = "Please enter valid numbers for all fields.";
return;
}
// — Mortgage Affordability Calculation —
// Lenders typically use the 28/36 rule as a guideline:
// Front-end ratio (PITI): Housing costs (Principal, Interest, Taxes, Insurance) should not exceed 28% of gross monthly income.
// Back-end ratio (Total Debt): Total debt payments (including PITI) should not exceed 36% of gross monthly income.
var grossMonthlyIncome = annualIncome / 12;
var maxPITI = grossMonthlyIncome * 0.28;
var maxTotalDebt = grossMonthlyIncome * 0.36;
// Estimate monthly property taxes and homeowner's insurance (e.g., 1.2% of home value annually for taxes, 0.5% for insurance)
// This is a simplification. Actual taxes and insurance vary greatly by location.
// We'll need to iteratively estimate the home price to get these values.
var estimatedMaxHomePrice = 0;
var iterations = 100; // To refine the estimate
var tolerance = 0.01;
var currentEstimatedHomePrice = grossMonthlyIncome * 12 * 0.3; // Initial guess
for (var i = 0; i < iterations; i++) {
var estimatedAnnualTaxes = currentEstimatedHomePrice * 0.012; // 1.2% for property tax
var estimatedAnnualInsurance = currentEstimatedHomePrice * 0.005; // 0.5% for homeowner's insurance
var estimatedMonthlyTaxesAndInsurance = (estimatedAnnualTaxes + estimatedAnnualInsurance) / 12;
// Calculate maximum affordable mortgage amount based on PITI limit
var remainingForP_I = maxPITI – estimatedMonthlyTaxesAndInsurance;
if (remainingForP_I 0) currentEstimatedHomePrice *= 0.99; // Reduce guess if stuck
else break;
continue;
}
// Calculate maximum mortgage principal (P+I) affordability
var monthlyInterestRate = interestRate / 100 / 12;
var numberOfPayments = loanTerm * 12;
var maxMortgagePrincipal = 0;
if (monthlyInterestRate > 0) {
maxMortgagePrincipal = remainingForP_I * (1 – Math.pow(1 + monthlyInterestRate, -numberOfPayments)) / monthlyInterestRate;
} else { // Handle 0% interest rate case
maxMortgagePrincipal = remainingForP_I * numberOfPayments;
}
var totalAffordablePriceFromPITI = maxMortgagePrincipal + downPayment;
// Now check against the back-end ratio (36% rule)
var maxTotalMonthlyPayment = maxTotalDebt;
var maxAffordableMortgageFromDebtRule = maxTotalMonthlyPayment – estimatedMonthlyTaxesAndInsurance;
if (maxAffordableMortgageFromDebtRule 0) {
maxMortgagePrincipalFromDebtRule = maxAffordableMortgageFromDebtRule * (1 – Math.pow(1 + monthlyInterestRate, -numberOfPayments)) / monthlyInterestRate;
} else { // Handle 0% interest rate case
maxMortgagePrincipalFromDebtRule = maxAffordableMortgageFromDebtRule * numberOfPayments;
}
var totalAffordablePriceFromDebtRule = maxMortgagePrincipalFromDebtRule + downPayment;
// The true affordable price is the minimum of the two rules, adjusted for down payment.
// We need to find a home price where the calculated PITI + Debt = Max Debt AND PITI = Max PITI
// This iterative approach finds a home price that satisfies both.
var nextEstimatedHomePrice = Math.min(totalAffordablePriceFromPITI, totalAffordablePriceFromDebtRule);
if (Math.abs(nextEstimatedHomePrice – currentEstimatedHomePrice) 0) {
monthlyPrincipalAndInterest = loanAmount * (monthlyInterestRate * Math.pow(1 + monthlyInterestRate, numberOfPayments)) / (Math.pow(1 + monthlyInterestRate, numberOfPayments) – 1);
} else {
monthlyPrincipalAndInterest = loanAmount / numberOfPayments;
}
var totalMonthlyPayment = monthlyPrincipalAndInterest + finalMonthlyTaxesAndInsurance;
var totalMonthlyDebtWithMortgage = totalMonthlyPayment + monthlyDebt;
if (estimatedMaxHomePrice <= 0 || isNaN(estimatedMaxHomePrice)) {
resultElement.innerHTML = "Based on your input, it appears you may not qualify for a mortgage under standard lending guidelines (e.g., 28/36 rule) with these parameters. Please review your income, debts, and desired loan terms.";
} else {
var formattedMaxHomePrice = estimatedMaxHomePrice.toLocaleString('en-US', { style: 'currency', currency: 'USD' });
var formattedLoanAmount = (estimatedMaxHomePrice – downPayment).toLocaleString('en-US', { style: 'currency', currency: 'USD' });
var formattedTotalMonthlyPayment = totalMonthlyPayment.toLocaleString('en-US', { style: 'currency', currency: 'USD' });
var formattedMonthlyPrincipalAndInterest = monthlyPrincipalAndInterest.toLocaleString('en-US', { style: 'currency', currency: 'USD' });
var formattedMonthlyTaxesAndInsurance = finalMonthlyTaxesAndInsurance.toLocaleString('en-US', { style: 'currency', currency: 'USD' });
resultElement.innerHTML = `
Estimated Maximum Home Price You Can Afford: ${formattedMaxHomePrice}
Estimated Mortgage Loan Amount: ${formattedLoanAmount}
Estimated Total Monthly Housing Payment (PITI): ${formattedTotalMonthlyPayment}
- Principal & Interest: ${formattedMonthlyPrincipalAndInterest}
- Taxes & Insurance (Estimated): ${formattedMonthlyTaxesAndInsurance}
Note: This is an estimate based on the 28% (housing) and 36% (total debt) debt-to-income ratios. Actual affordability depends on lender specifics, credit score, loan type, and precise property taxes/insurance.
`;
}
}
Understanding Mortgage Affordability
Buying a home is a significant financial decision, and understanding how much you can realistically afford is the crucial first step. Lenders use various metrics to determine mortgage eligibility, but a common guideline is the 28/36 rule. This calculator helps you estimate your potential home-buying power based on this rule and other key financial factors.
The 28/36 Rule Explained
Lenders often look at two main debt-to-income ratios:
- Front-End Ratio (28% Rule): This ratio dictates that your total monthly housing expenses should not exceed 28% of your gross monthly income. Housing expenses, often referred to as PITI, include:
- Principal: The amount paid towards the loan itself.
- Interest: The cost of borrowing the money.
- Taxes: Property taxes assessed by your local government.
- Insurance: Homeowner's insurance to protect against damage or loss.
- Back-End Ratio (36% Rule): This is a broader measure. Your total monthly debt obligations, including your potential PITI payment PLUS all other recurring debts (like car loans, student loans, credit card minimum payments), should not exceed 36% of your gross monthly income.
How the Calculator Works
Our Mortgage Affordability Calculator takes your input for:
- Annual Gross Income: The total income you earn before taxes and deductions.
- Total Monthly Debt Payments (excluding mortgage): The sum of your minimum monthly payments for all other debts.
- Down Payment Amount: The cash you plan to put down upfront, which reduces the loan amount needed.
- Estimated Mortgage Interest Rate: The anticipated interest rate on your mortgage loan. This significantly impacts your monthly payment.
- Mortgage Loan Term (years): The duration over which you plan to repay the mortgage (e.g., 15, 30 years). Longer terms usually mean lower monthly payments but higher total interest paid over time.
The calculator then estimates your maximum affordable home price by finding a price point where the projected PITI falls within the 28% guideline and the total debt (PITI + other debts) stays within the 36% guideline. It also makes assumptions for property taxes and homeowner's insurance, which are essential components of your monthly housing cost.
Important Considerations
- Estimates Only: This calculator provides an estimate. Actual loan approval amounts can vary significantly based on the lender's specific underwriting criteria, your credit score, employment history, the type of mortgage loan (e.g., FHA, VA, Conventional), and fluctuating property tax and insurance costs in your desired area.
- Property Taxes and Insurance: The calculator uses general estimates for these costs (e.g., 1.2% for taxes and 0.5% for insurance annually). These can be much higher or lower depending on your location. Always research local rates.
- Closing Costs: Remember that purchasing a home involves additional costs beyond the down payment, such as appraisal fees, title insurance, lender fees, and pre-paid items. These are not included in the affordability calculation.
- Lender Pre-Approval: For the most accurate understanding of your borrowing power, it is highly recommended to get pre-approved by a mortgage lender.
Using this calculator can give you a solid starting point for your home-buying journey, helping you set realistic expectations and focus your search on properties within your financial reach.