⚑ An estimate, not advice
This tool provides estimates for educational purposes only and is not financial, tax or legal advice. Consult a licensed professional before making decisions.
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Maximum home price
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$0Estimated loan amount
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Compare today's mortgage & refinance rates
The rate you qualify for changes how much house you can afford. Comparing several lenders can lift your budget — or save thousands. Prefer an interest-free route? Read our halal mortgage guide below.
Halal home-finance options →How the home affordability calculator works
Lenders limit your total monthly debt to a share of your gross income — the debt-to-income (DTI) ratio. We start from your maximum allowed monthly housing-plus-debt budget:
maxMonthly = income ÷ 12 × targetDTI − monthlyDebts
We reserve about 17% of that for property tax and home insurance, leaving roughly 83% as your monthly principal-and-interest budget. We then reverse the amortization formula to find the largest loan that budget supports:
loan = P&I × [ (1+r)n − 1 ] / [ r(1+r)n ]
where r is the monthly interest rate (annual rate ÷ 12 ÷ 100) and n is the number of months (years × 12). Finally, your maximum home price is that loan amount plus your down payment. If your monthly debts already exceed your DTI limit, there is no room left for a mortgage, so the estimate is $0.
Frequently asked questions
How much house can I afford on my income?
Lenders cap your total monthly debts at a share of gross income — the DTI ratio, often around 36%. This tool takes that limit, subtracts your existing debts, reserves part of the rest for tax and insurance, and works backwards from the leftover principal-and-interest budget to the largest loan and home price you can support.
What is a good debt-to-income ratio for buying a home?
Many lenders prefer a total DTI of 36% or lower, and some allow up to 43%–50% for qualified borrowers. A lower target leaves more breathing room. Lowering your target DTI here reduces the home price the calculator estimates.
Does this include property tax and insurance?
Yes — it reserves an estimated share of your monthly housing budget for property tax and home insurance, based on the annual percentage of home price you enter (1.5% by default). The rest funds mortgage principal and interest, which sets the loan amount.
How can I afford a more expensive home?
Increasing your down payment, raising your income, paying off existing monthly debts, or securing a lower mortgage rate all raise the price you can afford. A bigger down payment adds directly to the price; lower debts free up more monthly budget for principal and interest.
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Sources & further reading
Standard amortization formula; U.S. Consumer Financial Protection Bureau (consumerfinance.gov) for debt-to-income and home-affordability guidance. Read our full disclaimer →