How much house can you afford?
Lenders use two debt ratios. Plug in your numbers and see the price range they imply.
Affordability is set less by the home price than by your income, existing debts and down payment. This tool applies the same ratio tests a lender uses.
Affordability estimate
A note of caution
The maximum a lender will approve is a ceiling, not a target. Buying below your limit gives you breathing room for property taxes, repairs, and the near-certainty that rates and life will change over a 25- or 30-year horizon.
Frequently asked questions
What debt ratios do lenders use?
Lenders look at the housing ratio (housing costs vs gross income, typically under 30 to 32 percent) and the total debt ratio (all debts vs income, typically under 40 to 44 percent).
Does my down payment change what I can afford?
Yes. A larger down payment increases the price you can buy at for the same payment, and above 20 percent it removes mortgage insurance, lowering monthly cost.
Should I borrow the maximum I qualify for?
Usually not. Qualifying for a payment and comfortably affording it are different. Leave room for rate increases, maintenance and life changes.
Do lenders count all my income?
They count stable, provable income. Variable income like bonuses or self-employment may be averaged or discounted. Have documentation ready.
What if rates rise after I buy?
On a variable or at renewal, your payment can rise. Stress-test yourself at a rate 2 percent higher than today to be sure you can handle it.