Detailed Home Affordability Calculator
Understanding your home affordability is crucial in your home buying journey. Our detailed home affordability calculator helps you make informed decisions.
- Enter your annual income.
- Enter your monthly debt.
- Enter your down payment.
- Enter the home price.
- Enter the interest rate.
- Enter the loan term in years.
- Click ‘Calculate’.
Our calculator uses the following formula to calculate your maximum affordable home price:
Maximum Affordable Home Price = (Annual Income * (1 – Debt-to-Income Ratio)) / (Interest Rate * Loan Term * 12) – Down Payment
| Region | Average Home Price |
|---|---|
| West | $525,000 |
| Northeast | $375,000 |
| Midwest | $225,000 |
| South | $250,000 |
| Loan Term (Years) | Average Mortgage Rate |
|---|---|
| 15 | 3.25% |
| 30 | 4.25% |
- Consider your long-term financial goals when choosing a loan term.
- Improve your credit score to get better interest rates.
- Save for a larger down payment to reduce your monthly mortgage payment.
What is the debt-to-income ratio?
The debt-to-income ratio is the percentage of your gross monthly income that goes towards paying your debts.
How does the interest rate affect my mortgage payment?
A higher interest rate means you’ll pay more in interest over the life of your loan, resulting in a higher monthly mortgage payment.
For more information, see the Consumer Financial Protection Bureau’s guide to homeownership.
You can also learn more about home affordability from the U.S. Department of Housing and Urban Development.