Your inputs

Estimate what you can afford

Gross annual income

Total household income before taxes, up to $100,000,000.

Monthly debt payments

Car loans, student loans, and card minimums. Use 0 if none.

Down payment

Cash you can put toward the purchase. Use 0 if none.

Interest rate

Expected mortgage rate, from 0% through 25%.

Loan term

Advanced assumptions

Debt-to-income limit

Share of gross monthly income for all housing costs, from 5% through 60%. A common guideline is 36%.

Monthly taxes and insurance

Estimated property tax and homeowners insurance per month. Use 0 to see principal and interest only.

Your inputs are calculated locally and are not stored.

Home price you can afford$577,054.00

With this income, debts, and down payment, you could afford a home priced up to about $577,054.00.

Max loan amount: $517,054.00
Max monthly housing payment: $3,100.00
Max principal & interest: $3,100.00

Formula & methodology

How home affordability is calculated

Affordability starts from a debt-to-income (DTI) limit — the share of your gross monthly income that can go toward all housing costs. After subtracting existing monthly debts and any taxes and insurance, the remaining amount is the most you can put toward principal and interest. That payment is converted into a maximum loan using the present-value-of-an-annuity formula, then your down payment is added to get a maximum home price.

Max housing = (Annual income ÷ 12) × DTI% − Monthly debts
Max loan = P&I × (1 − (1 + r)⁻ⁿ) / r
Max home price = Max loan + Down payment

P&I: Max monthly principal & interest
DTI%: Debt-to-income limit for all housing costs
r: Monthly interest rate (annual rate ÷ 12)
n: Total number of monthly payments

Worked example

$120,000 income, $500 monthly debts, $60,000 down

With a $120,000 gross annual income, $500 in monthly debt payments, a $60,000 down payment, a 6% interest rate, a 30-year term, and a 36% debt-to-income limit, the gross monthly income is $10,000. A 36% limit allows $3,600 for total housing, and after the $500 of existing debts, $3,100 is available for principal and interest. That $3,100 payment supports a maximum loan of about $517,054, which plus the $60,000 down payment is a maximum home price of roughly $577,054. The maximum monthly housing payment is $3,100 and the maximum principal & interest is $3,100.

This is an educational estimate based only on the values you enter. It does not look up live rates and is not a loan pre-approval.

Assumptions

What this calculator assumes

The debt-to-income limit applies to all housing costs combined, and defaults to a common 36% guideline.
The entered interest rate is fixed for the full loan term; adjustable or variable rates are not modeled.
Taxes and insurance are an optional monthly pass-through estimate; set them to 0 to see principal and interest only.
Private mortgage insurance (PMI) or mortgage default insurance is not modeled.
Money values are rounded to the nearest cent for display.

Common questions

Home affordability FAQ

What is a debt-to-income ratio?

Debt-to-income (DTI) is the share of your gross monthly income that goes toward debt payments. Lenders use it to gauge how much additional housing debt you can take on. A common guideline caps all housing costs at around 36% of gross monthly income, though limits vary by lender and loan program.

Does a bigger down payment let me afford more house?

Yes. Your monthly income and debts determine the maximum loan you can support, and the down payment is added on top of that loan to reach the maximum home price. A larger down payment raises the price you can afford dollar-for-dollar without changing the underlying monthly payment.

Primary sources

Sources and review notes

Methodology last checked Jul 14, 2026. Formula implementation is covered by deterministic unit tests. No financial professional review is claimed yet.