Understanding how much mortgage you can afford is a crucial first step in the home-buying process. This calculator helps you estimate your potential borrowing power based on your income, debts, and desired down payment. It takes into account common lending criteria, such as the debt-to-income (DTI) ratio, which lenders use to assess your ability to manage monthly payments. A lower DTI generally indicates a stronger financial position and a higher likelihood of loan approval.
To use the calculator, simply enter your estimated gross monthly income, your total monthly debt payments (excluding potential mortgage payments), and the amount you plan to put down as a down payment. The calculator will then provide an estimated maximum monthly mortgage payment you might qualify for, and consequently, an approximate maximum home price you can afford. Remember, this is an estimate, and your actual borrowing capacity may vary depending on the lender, your credit score, current interest rates, and other financial factors.
Your Estimated Mortgage Affordability:
function calculateMortgageAffordability() {
var grossMonthlyIncome = parseFloat(document.getElementById("grossMonthlyIncome").value);
var totalMonthlyDebt = parseFloat(document.getElementById("totalMonthlyDebt").value);
var downPayment = parseFloat(document.getElementById("downPayment").value);
var interestRate = parseFloat(document.getElementById("interestRate").value) / 100;
var loanTerm = parseFloat(document.getElementById("loanTerm").value);
var resultDiv = document.getElementById("result");
resultDiv.innerHTML = ""; // Clear previous results
// Basic validation
if (isNaN(grossMonthlyIncome) || isNaN(totalMonthlyDebt) || isNaN(downPayment) || isNaN(interestRate) || isNaN(loanTerm) ||
grossMonthlyIncome <= 0 || totalMonthlyDebt < 0 || downPayment < 0 || interestRate < 0 || loanTerm <= 0) {
resultDiv.innerHTML = "Please enter valid positive numbers for all fields.";
return;
}
// Lender typically allows a maximum DTI of around 43% (this can vary)
var maxDtiRatio = 0.43;
var maxHousingPayment = (grossMonthlyIncome * maxDtiRatio) – totalMonthlyDebt;
if (maxHousingPayment 0) {
maxLoanAmount = maxHousingPayment * (Math.pow(1 + monthlyInterestRate, numberOfMonths) – 1) / (monthlyInterestRate * Math.pow(1 + monthlyInterestRate, numberOfMonths));
} else { // Handle 0% interest rate (though unlikely for mortgages)
maxLoanAmount = maxHousingPayment * numberOfMonths;
}
var maxAffordablePrice = maxLoanAmount + downPayment;
// Display results
resultDiv.innerHTML = `
Estimated Maximum Monthly Mortgage Payment (Principal & Interest): $${maxHousingPayment.toFixed(2)}
Estimated Maximum Loan Amount: $${maxLoanAmount.toFixed(2)}
Estimated Maximum Affordable Home Price: $${maxAffordablePrice.toFixed(2)}
Note: This calculation excludes property taxes, homeowner's insurance, and potential Private Mortgage Insurance (PMI), which would increase your total monthly housing cost. It also assumes a maximum Debt-to-Income (DTI) ratio of 43%. Actual loan approval and amounts are determined by lenders based on a comprehensive review of your finances, credit history, and market conditions.
`;
}
.calculator-container {
font-family: sans-serif;
max-width: 600px;
margin: 20px auto;
padding: 20px;
border: 1px solid #ddd;
border-radius: 8px;
box-shadow: 0 2px 4px rgba(0,0,0,0.1);
}
.calculator-container h2 {
text-align: center;
margin-bottom: 20px;
color: #333;
}
.calculator-container p {
line-height: 1.6;
margin-bottom: 15px;
color: #555;
}
.calculator-inputs {
display: grid;
grid-template-columns: repeat(auto-fit, minmax(250px, 1fr));
gap: 15px;
margin-bottom: 20px;
}
.input-group {
display: flex;
flex-direction: column;
}
.input-group label {
margin-bottom: 5px;
font-weight: bold;
color: #444;
}
.input-group input {
padding: 10px;
border: 1px solid #ccc;
border-radius: 4px;
font-size: 1rem;
}
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display: block;
width: 100%;
padding: 12px 20px;
background-color: #007bff;
color: white;
border: none;
border-radius: 4px;
font-size: 1.1rem;
cursor: pointer;
transition: background-color 0.3s ease;
margin-bottom: 20px;
}
.calculator-container button:hover {
background-color: #0056b3;
}
.calculator-results {
background-color: #f9f9f9;
padding: 15px;
border-radius: 4px;
border: 1px solid #eee;
}
.calculator-results h3 {
margin-top: 0;
color: #333;
text-align: center;
margin-bottom: 15px;
}
#result p {
margin-bottom: 10px;
color: #333;
}
#result strong {
color: #007bff;
}