Understanding how much house you can afford is a crucial first step in the home-buying process.
Our Mortgage Affordability Calculator helps you estimate your maximum mortgage loan amount based on
your income, debts, and down payment. This tool simplifies the complex calculations involved in
determining your borrowing power, allowing you to set a realistic budget and focus your house search.
To use the calculator, you'll need to provide information about your gross monthly income (your income before taxes and deductions),
your total monthly debt payments (including credit cards, car loans, student loans, and any other recurring debts),
and the amount you plan to use for your down payment. Lenders typically consider your Debt-to-Income ratio (DTI) when approving mortgages.
A common guideline is that your total monthly housing payment (principal, interest, taxes, and insurance) should not exceed 28% of your gross monthly income,
and your total monthly debt obligations (including housing) should not exceed 36% of your gross monthly income.
This calculator will help you estimate the maximum loan amount you might qualify for based on these principles,
though actual lender approval will depend on various factors including your credit score, loan type, and current market conditions.
Calculate Your 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);
var loanTerm = parseFloat(document.getElementById("loanTerm").value);
var resultDiv = document.getElementById("result");
resultDiv.innerHTML = ""; // Clear previous results
if (isNaN(grossMonthlyIncome) || isNaN(totalMonthlyDebt) || isNaN(downPayment) || isNaN(interestRate) || isNaN(loanTerm)) {
resultDiv.innerHTML = "Please enter valid numbers for all fields.";
return;
}
if (grossMonthlyIncome <= 0 || totalMonthlyDebt < 0 || downPayment < 0 || interestRate <= 0 || loanTerm <= 0) {
resultDiv.innerHTML = "Please enter positive values for income, interest rate, and loan term, and non-negative values for debt and down payment.";
return;
}
// Lender's common guideline for total debt-to-income ratio (front-end estimation)
// Typically, PITI (Principal, Interest, Taxes, Insurance) should be around 28% of gross monthly income,
// and total debt (PITI + other debts) should be around 36% of gross monthly income.
// We'll aim for the 36% total debt limit and work backwards to find the maximum PITI we can afford,
// then estimate the loan amount from that PITI.
var maxTotalMonthlyObligations = grossMonthlyIncome * 0.36;
var maxPiti = maxTotalMonthlyObligations – totalMonthlyDebt;
if (maxPiti 0) {
var factor = Math.pow(1 + monthlyInterestRate, numberOfPayments);
maxLoanAmount = maxPiti * (factor – 1) / (monthlyInterestRate * factor);
} else { // Handle 0% interest rate case, though unlikely for mortgages
maxLoanAmount = maxPiti * numberOfPayments;
}
// Note: This calculator does NOT include property taxes and homeowner's insurance (PITI).
// It estimates the maximum loan amount based on income, debt, interest rate, and loan term,
// assuming the calculated PITI directly relates to the loan principal repayment.
// A real mortgage payment includes Principal, Interest, Taxes, and Insurance (PITI).
// The 'maxPiti' calculated above is the maximum you can afford for P+I+T+I.
// This calculation isolates the P+I portion for estimating the loan principal.
// The actual 'maximum affordable house price' would be maxLoanAmount + downPayment.
var estimatedMaxHousePrice = maxLoanAmount + downPayment;
resultDiv.innerHTML = "
Estimated Mortgage Affordability
" +
"Maximum Estimated P&I Payment You Can Afford (based on 36% DTI): $" + maxPiti.toFixed(2) + "" +
"Estimated Maximum Loan Amount: $" + maxLoanAmount.toFixed(2) + "" +
"Estimated Maximum House Price (Loan + Down Payment): $" + estimatedMaxHousePrice.toFixed(2) + "" +
"Disclaimer: This is an estimation for informational purposes only. Actual loan approval and affordability will depend on lender criteria, credit score, property taxes, insurance, and other factors.";
}