Buy A Home Calculator
“How much house can I afford?” is really two questions: what will a lender’s debt ratios allow, and what payment still leaves you a life? This buy a home calculator answers the first one honestly. Enter income, monthly debts, down payment, rate, term, property tax rate and insurance, and it finds the highest home price whose full monthly cost, principal and interest, tax, insurance and PMI where it applies, fits inside both the 28% housing cap and the 43% total-debt cap.
It is an affordability ceiling, not a savings goal and not a pre-approval. The worked example below uses a $100,000 income, $500 a month of existing debts and a $20,000 down payment, and every number in it is the number the tool itself returns.
A planning ceiling, not a pre-approval and not a recommendation to spend the maximum. The model excludes HOA dues, closing costs, maintenance and moving costs, and it prices PMI at a flat 0.5 percent of the loan per year when the down payment is under 20 percent.
Quick Answer
Key takeaways
- Two caps, and the lower one wins: housing cost at or under 28% of gross monthly income, and housing plus other debts at or under 43%. The results name which cap bound your answer.
- Property tax and PMI are priced off the home price, so there is no closed-form shortcut: the tool searches for the price where the full monthly cost exactly meets the cap.
- PMI switches off at exactly 20% down. Near that line, a slightly cheaper home can cost notably less per month than a slightly dearer one.
- The ceiling excludes HOA dues, closing costs and maintenance. It is a lender-style maximum, not a comfortable budget.
- Quick Answer
- The two caps that set your ceiling
- How the calculator finds the price
- Worked example: $100,000 income, $500 debts, $20,000 down
- PMI and the 20 percent cliff
- When debts bind instead: the $1,500 case
- What competing calculators miss
- Frequently Asked Questions
- Add This Calculator to Your Website
- References
The two caps that set your ceiling
Your ceiling is set by whichever cap is tighter. The housing cap allows 28% of gross monthly income for the full housing cost: principal and interest, property tax, insurance, and PMI when it applies. The total-debt cap allows 43% of gross monthly income for housing plus the debts you already pay. On the worked example, monthly income is $8,333.33, so the housing cap is $2,333.33 and the total-debt cap leaves $3,083.33 for housing after the $500 of debts. The housing cap is lower, so it binds.
A word on the 43% figure, because you will also meet the classic “28/36 rule” elsewhere. The 36% back-end is a conservative planning guideline. The 43% level has a regulatory history: it was the debt-to-income ceiling in the CFPB’s original General Qualified Mortgage definition, before that definition moved to a price-based test, as summarized in SoFi’s qualified mortgage explainer. Many lenders still underwrite conventional loans somewhere in the 43 to 50 percent range with compensating factors. This tool uses 43%: more realistic than 36% for what a lender may allow, still short of the loosest approvals. Neither cap is a promise; both are screens.
How the calculator finds the price
There is no single formula for the maximum price, because two of the costs depend on the price itself: property tax is a percentage of the price, and PMI switches on or off depending on whether your down payment reaches 20% of the price. So the tool searches.
Compute both caps from income and debts, and take the smaller as the monthly housing budget.
Test a price. Loan = price – down payment. Compute principal and interest on that loan, monthly tax on that price, monthly insurance, and PMI if the down payment is under 20% of that price.
Halve the range. If the total fits the budget, the price becomes the new floor and the tool tests higher; if not, it becomes the ceiling and the tool tests lower. The search starts between $0 and $2,000,000 and narrows until the range is under $100 wide.
Report the best fitting price with its full monthly breakdown, the resulting back-end DTI, and which cap bound the answer.
The $100 tolerance is why results carry cents that look oddly precise, such as $306,030.27. Read the answer as “about $306,000”, and treat the breakdown, not the cents, as the information.
Worked example: $100,000 income, $500 debts, $20,000 down
The calculator is pre-filled with this case, and the table below is its exact output.
| Figure | Value |
|---|---|
| Maximum home price | $306,030.27 |
| Loan amount (price – $20,000 down) | $286,030.27 |
| Principal and interest | $1,807.91/mo |
| Property tax (1.2% of price) | $306.03/mo |
| Insurance ($1,200/yr) | $100.00/mo |
| PMI (0.5%/yr of loan, down under 20%) | $119.18/mo |
| Total housing cost | $2,333.12/mo |
| Back-end DTI (housing + $500 debts) | 34.0% |
| Binding constraint | 28% housing rule |
The rate is doing heavy lifting in that table. The same household with a rate bought down by half a point could carry a higher price at the same monthly cap, which is why buyers price the buydown decision alongside affordability with the buy-down rate calculator rather than after choosing a home.
PMI and the 20 percent cliff
Private mortgage insurance protects the lender, and in this calculator it is priced at a flat 0.5% of the loan per year whenever the down payment is under 20% of the price. That flat rate is a modeling choice, stated here so you can judge it: real PMI pricing varies with credit score and loan-to-value, commonly from about 0.3% to over 1% a year, and FHA loans use mortgage insurance premiums with different rules. Treat the tool’s PMI line as a mid-range estimate.
The cliff matters more than the rate. Run the same $100,000 income with no monthly debts and a $70,000 down payment, and the tool returns a maximum price of $349,975.59, with PMI of $0.00 and total housing of $2,219.61. That answer sits just under $350,000 for a reason: at $350,000 the down payment is exactly 20% and PMI is off, but one dollar of price above that line switches PMI back on, adding roughly $117 a month and pushing the total over the cap. So the search stops at the cliff edge, with $113.72 of monthly cap unused. If your down payment is near 20% of your target price, test prices on both sides of the line: the monthly cost does not move smoothly across it.
When debts bind instead: the $1,500 case
Raise monthly debts to $1,500, keeping everything else from the worked example, and the answer changes character. The 43% cap now leaves only $2,083.33 for housing, less than the $2,333.33 housing cap, so the total-debt rule binds and the maximum price falls to $273,742.68, with total housing of $2,083.30 and a back-end DTI of exactly 43.0%.
| Scenario | Monthly debts | Down | Max price | Binding cap |
|---|---|---|---|---|
| Worked example | $500 | $20,000 | $306,030.27 | 28% housing |
| No debts, bigger down payment | $0 | $70,000 | $349,975.59 | 28% housing (PMI cliff) |
| Heavy debts | $1,500 | $20,000 | $273,742.68 | 43% total debt |
The practical lesson: $1,000 a month of extra debt payments removed $32,287.59 of buying power in this example. Paying off a car loan before you shop can be worth more than the same cash added to the down payment, because it relaxes the cap itself rather than just the loan size. Households selling one home to fund the next face the same trade from the other side, and the buy sell mortgage calculator works that version: proceeds in, new down payment and payment out.
What competing calculators miss
Affordability is a crowded keyword, and the big lender and portal tools are polished. Their gaps are specific.
Miss 1: silent rule choices. Many tools hard-code the classic 28/36 rule, or a lender-max DTI near 50%, without telling you which, so two calculators can disagree by $50,000 on identical inputs and both look authoritative. This page states its caps, shows both of them with your numbers, and names the one that bound your result.
Miss 2: tax and PMI as flat add-ons. Tools that ask for “monthly taxes” as a single guessed dollar figure cannot show the PMI cliff or the way tax scales with price. Pricing both off the tested price, inside the search, is what produces the cliff behavior in the $70,000-down scenario.
Miss 3: a price with no audit trail. A single maximum-price number, with no breakdown of principal and interest, tax, insurance and PMI at that price, cannot be checked against a Loan Estimate. The breakdown here can, line by line. Guidance from the Consumer Financial Protection Bureau on choosing a loan type makes the same point from the lender side: compare offers on the same structure, over the time you expect to keep the loan.
Spending up to the ceiling can work if
- Your income is stable and the debts you entered are the whole story
- You keep a separate emergency fund after the down payment
- The home needs no major work in the first years
Staying under the ceiling is safer if
- Income varies, or one earner carries the household
- HOA dues, childcare, or maintenance will add monthly costs the caps ignore
- You expect to move or refinance within a few years
When you move from ceiling to a real application, the checks get stricter and the paperwork starts: the approval for home loan calculator looks at the approval side of the same income and debt picture.
Frequently Asked Questions
With $500 a month of debts, a $20,000 down payment, a 6.5% rate over 30 years, 1.2% property tax and $1,200 a year of insurance, this calculator returns $306,030.27, with a total monthly housing cost of $2,333.12. Change any input and the ceiling moves: debts and the rate move it most.
The classic guideline caps housing at 28% of gross income and all debts at 36%. This calculator keeps the 28% housing cap but uses a 43% total-debt cap, the level from the CFPB’s original Qualified Mortgage definition and still a common conventional underwriting line. It is a middle position: less strict than 36%, less loose than the 50% some lenders allow with strong compensating factors.
Private mortgage insurance protects the lender if you default. On conventional loans it is normally required when your down payment is under 20% of the price. This calculator prices it at a flat 0.5% of the loan per year, $119.18 a month in the worked example. Real PMI pricing varies with credit and loan-to-value, so treat that line as an estimate.
Yes. Property tax is computed from the tax rate you enter, applied to each tested price, and insurance is your annual premium spread monthly. Both sit inside the cap test, which is why a high-tax area lowers your maximum price even at the same income and rate.
Yes, through the 43% total-debt cap. In the scenario table above, raising monthly debts from $500 to $1,500 cut the maximum price from $306,030.27 to $273,742.68 and made the total-debt cap the binding one. Lenders count minimum payments on car loans, student loans and credit cards the same way.
Twenty percent of the purchase price. At exactly 20% the calculator charges no PMI; one dollar under the line and PMI applies to the whole loan at 0.5% per year. That cliff is why the no-debts scenario stops at $349,975.59 with a $70,000 down payment instead of using the full monthly cap.
The calculator has no HOA field, and its results exclude dues. If a home has HOA dues, budget for them on top of the total housing figure shown, and consider targeting a price enough below the ceiling to absorb them. Lenders do count HOA dues in your housing ratio, so a dues-heavy property will qualify for less than this ceiling suggests.
They are not in this calculation. Closing costs typically run about 2 to 5 percent of the loan amount and are paid in cash at closing, on top of the down payment. Keep them out of your down payment fund when you set the down payment input, or the real cash needed will surprise you.
No. A pre-approval verifies income, assets and credit, and applies a specific lender’s guidelines, which may be tighter or looser than the 28% and 43% caps used here. Use this ceiling to set a shopping range, then let a lender’s verified numbers have the last word.
Add This Calculator to Your Website
References
- LendingTree, “How Much House Can I Afford?” – the 28/36 rule worked through with lender examples, including front-end and back-end ratio math. LendingTree: How Much House Can I Afford. Accessed October 2026.
- Consumer Financial Protection Bureau, “Select the Kind of Loan That Fits Your Needs” – how to compare loan structures, points and lender credits over the time you expect to keep the loan. CFPB: Select the Kind of Loan That Fits Your Needs. Accessed October 2026.
- SoFi Learn, “What Is a Qualified Mortgage?” – the CFPB ability-to-repay framework and the 43 percent debt-to-income history of the General QM definition. SoFi: What Is a Qualified Mortgage. Accessed October 2026.
- National Association of Realtors, “Qualified Residential Mortgage (QRM)” – policy background on the 43 percent DTI requirement, points and fees caps, and ability-to-repay verification. NAR: Qualified Residential Mortgage. Accessed October 2026.
- Manatt, Phelps and Phillips, “Consumer Mortgages: Why the CFPB’s QM Rule Compliance Delay Isn’t Quite What It Seems” – how the DTI-based General QM definition was replaced by a price-based test. Manatt: CFPB QM Rule Analysis. Accessed October 2026.