Home affordability calculator

The payment is not just the loan

Mortgage calculators that return one number are usually giving you principal and interest only. That is the smallest part of the answer. The monthly cost of owning also includes property tax, home insurance, often mortgage insurance, and sometimes an HOA fee.

Property tax alone varies by more than a factor of five between US states and counties, which means the same house at the same price can have very different monthly costs depending on where it sits. That is why it is an input here rather than a built-in assumption.

Why the small down payment costs twice

Putting less down does two things at once. It raises the loan, so the principal and interest go up. And below a common threshold it usually adds mortgage insurance — a monthly charge that protects the lender, not you, and buys you nothing.

Move the down payment slider across that threshold in the tool and watch the total step down twice over.

Running it backwards is the useful direction

Most people find a house, then check whether they can afford it. That order is how budgets get stretched — the number you have already fallen for becomes the target, and the arithmetic gets bent to reach it.

The tool works the other way too: from income, other debts, and the share of income you are willing to commit, it finds the price that actually fits. Run that first, and the listings you look at are already the right ones.

About the percentage guidelines

You will see rules of thumb like keeping housing to roughly 28% of gross income, with total debt payments under about 36%. These are conventional lending guidelines, not laws, and lenders vary in what they will approve.

Two things worth knowing about them. First, they are based on gross income — the money before tax that you never actually see, which makes the real squeeze tighter than the percentage suggests. Second, being approved for a payment is not the same as that payment being wise. Lenders assess whether you will repay them, not whether you will still be able to save afterwards.

What this leaves out

Maintenance, which is the cost first-time buyers most consistently underestimate. Utilities, which are often higher than in a rental. Closing costs. And the opportunity cost of the down payment, which would otherwise have been invested.

Rates, tax rates, insurance, and mortgage insurance depend on your lender, state, and credit profile. Get real quotes before making a decision this size.