An affordability calculator is a valuable financial tool designed to help you estimate how much home you can afford based on your income, expenses, and loan terms. Whether you're planning to buy your first home or evaluating your budget for a new mortgage, this calculator provides an easy way to assess your financial readiness for homeownership.
By entering details such as your monthly gross income, existing monthly debts, interest rate, loan term, down payment, and property tax rate, you can get a clear picture of your maximum affordable home price. The tool calculates your housing expenses and compares them to industry-standard debt-to-income (DTI) ratios to determine whether your scenario is financially viable.
Understanding affordability before applying for a mortgage can save you from future financial stress. Lenders typically consider both your total DTI ratio and your housing-only DTI ratio when determining loan eligibility. This calculator helps you stay within those thresholds, increasing your chances of loan approval and ensuring sustainable financial health.
The two key metrics evaluated are:
Simply fill out the fields with accurate information such as your income, existing debts, down payment amount, and desired loan term. The calculator will provide a detailed breakdown of your estimated maximum home price, monthly payments, and how your scenario fits within recommended DTI limits. A chart is also displayed for visual reference.
This tool is meant for informational purposes only and does not guarantee loan approval. For a comprehensive analysis, consider consulting with a certified mortgage advisor or financial planner.