Home Affordability Calculator
Our mortgage home affordability calculator makes it easy
to determine your maximum affordable home price. Just enter
your monthly income, debts, interest rates and the length
of your loan.
- Enter ballpark values by clicking on and dragging the
diamond-shaped sliders left or right. Enter exact numbers
by clicking on the number in the box on the right and type
your number (no commas).
- Click on tabs for details and for more options.
Purchase Price Chart Tab
You can enter basic information to easily determine how much
you can afford by using our Purchase Price Chart Tab.
Monthly Income
Your monthly income is the total amount of all income that
you would like to be considered for mortgage qualification.
Some Examples of income are: wages, salary, commission, bonuses,
overtime, interest, dividends, trust funds, child support,
alimony, pension, disability, rental income, public assistance,
social security, retirement, etc.
Other Debt
The total amount of you debt should include all monthly installment
debt including student loans, auto loans, 401(K) loans, all
credit card/revolving debt, alimony, child support and any
other debt with 10 or more payments remaining. Make sure that
you do not include rent, utility payments or the anticipated
payments for a home you may purchase or the payments on your
current home if it will be sold to purchase a new one.
Interest Rate
You should enter the interest rate you expect to get for your
mortgage loan. Base this amount on current market rates.
Loan Term
This drop down allows you to select the loan term you want.
Chart
Simply position the slider on the amount of down payment you
plan to make. The value shown above our interactive chart
is the purchase price you can afford based on the information
that you have entered above and where you have positioned
the slider. To leave the line at a specific value, slide your
cursor straight down and out of the chart area.
Purchase Price Table Tab
Our Purchase Price Table displays a more detailed summary
of the information in our chart on the Purchase Price Chart
Tab. This allows you to more easily analyze the differences
between down payments, closing costs, loan amounts and purchase
prices. The values on the right above the table are calculations
of your minimum and maximum total monthly payments (PITI =
principal, interest, taxes, insurance).
Each of the 25 rows shows the values for that percentage
of down payment.
Other Loan Factors Tab
If you know specific amounts for any other expenses you can
enter them here and our Other Loan Factors Tab will display
clear and easy to understand results.
Estimated Closing Costs
There are many miscellaneous fees that you will have to pay
at closing, such as points you pay to buy down your loan,
as well as fees for title searches, attorneys, brokers and
others. Estimate the total amount and enter it here.
Front-end Ratio
The portion of your income that a lender will allow you to
use for your mortgage payments is known as your front-end
ratio.
Back-end Ratio
The back-end ratio is the maximum percentage of your earnings
that a lender will allow you to use to repay all your debts,
including your mortgage payments.
Hazard Insurance
Here you should enter the amount you will pay for home owners
insurance for your new home.
Property Taxes
Property taxes are a percentage of the sales price of your
home. These payments are made to local, state and other governments
to cover various services.
HOA Fee
The Home Owner's Association fee is a monthly fee some home
owners pay for communal property upkeep. Not all home owners
pay HOA fees. Some examples are condo owners who pay for grounds
and exterior upkeep or subdivisions that have pools and club
houses which require such payments.
Mortgage Insurance Table
If you pay less than 20% down on the purchase price of your
home, you have to pay mortgage insurance. Our table breaks
down the percentage of the financed amount you will have to
pay annually in mortgage insurance based on your down payment
and loan term. Remember that the less you put down, the more
mortgage insurance you have to pay.
The left-hand column shows 4 rows of LTV (loan-to-value)
percentages. If you put down 5%, you have a 95% LTV. The top
row shows 4 columns representing typical loan terms.
If you purchase a home for $150,000 and put 10% down on a
30 year Fixed Rate Loan, you would be financing 90% of the
purchase price ($135,000). In order to calculate the Privat
Mortgage Insurance, you would calculate with the following
formula:
- financed amount X mortgage insurance factor = monthly
mortgage insurance
- $135,000 x 0.0079 = $1,066.50
- $1,066.50 ÷ 12 months = $88.88
- Your monthly mortgage insurance would be $88.88. Add
this amount to your monthly mortgage payment.
Click
Here to open the Home Affordability Calculator |
