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How much house can I afford?

Find out how much home you can afford based on your income, debts, and available cash. Get personalized affordability estimates with VA loan options.

What This Calculator Is

A home affordability calculator determines the maximum home price you can comfortably purchase based on your income, existing debts, and available savings. It uses standard lending guidelines—typically keeping your debt-to-income ratio below 43%—to ensure you borrow within safe limits. This calculator also factors in VA loan benefits for veterans, which can significantly increase buying power through zero down payment options.

Who This Calculator Is For

This calculator serves prospective homebuyers who want to set realistic expectations before house hunting, veterans exploring VA loan benefits, and anyone trying to understand how their income translates into purchasing power. Financial planners use it to help clients set savings goals, while real estate agents use it to match buyers with appropriate properties.

When to Use This Calculator

Use this calculator at the very beginning of your home buying journey to establish a price range, when your financial situation changes (raise, new debts, savings growth), when comparing conventional versus VA loan options, or when deciding how much to save for a down payment. Run it again whenever interest rates change significantly, as this directly impacts how much home you can afford.

Inputs

$85,000.00
$400.00
$50,000.00
6.750%
1.100%
$1,500.00
$0.00

0% down for veterans and their spouses, no mortgage insurance required.

Results

Maximum Home Price

$308,826.71

Est. Monthly Payment$2,433.23
Total Loan Amount$293,385.38
Est. Closing Costs$9,264.80
Debt-to-Income Ratio39.998%

Monthly Payment Breakdown

$2,433.23Monthly payment
Principal/Interest
$1,902.89
Property Taxes
$283.09
Home Insurance
$125.00
PMI
$122.24

Savings, if any, vary based on consumer credit profile, interest rate availability, and other factors.

Insights

Your budget

Based on a target 40% DTI, you can afford a home up to $308,826.71 with a total loan of $293,385.38.

Est. closing costs

Estimated closing costs are $9,264.80 (approximately 3% of home price).

DTI: 40.0% (Stretch)

You're stretching your budget. Ensure you have reserves for emergencies.

Default rates: Federal Reserve Economic Data (FRED), Freddie Mac Primary Mortgage Market Survey

How Home Affordability Is Calculated

The calculator targets a 40% debt-to-income ratio for maximum affordability. For VA loans, it calculates the funding fee based on your military type, down payment, and whether you've used VA benefits before. The funding fee can be financed into your loan.

maxHousingPayment = (monthlyIncome * targetDTI) - monthlyDebts, where monthlyIncome = annualIncome/12 and targetDTI defaults to 40% (clamped 15-60%).
Home price is solved iteratively (up to 15 iterations, bisection-style averaging) so that: PI + monthlyTax + monthlyInsurance + monthlyHOA + monthlyPMI = maxHousingPayment, where PI = standard mortgage amortization payment on the loan (incl. VA funding fee if applicable), monthlyTax = homePrice*propertyTaxRate/12, monthlyPMI = baseLoanAmount*0.005/12 if down payment < 20% and not VA.
VA funding fee = baseLoanAmount * fundingFeeRate(militaryType, firstTimeVA, downPaymentPercent, exemption), financed into total loan.
Final downPaymentAmount = maxHomePrice * downPaymentPercent/100.
Where: annualIncome, monthlyDebts, interestRate, loanTerm (15/30 yr parsed as integer, default 30), propertyTax (%), homeInsurance (annual), hoaFees (monthly), isVeteran, militaryType, firstTimeVA, fundingFeeExempt, wantsDownPayment, downPaymentPercent.
Assumptions: monthly compounding; PMI flat 0.5%/yr of base loan if <20% down and non-VA; VA loans skip PMI; funding fee can be financed; convergence tolerance $100 or 15 iterations; negative/zero housing budget returns all zeros.

Key Takeaways

  • •VA loans require no down payment and no PMI, making homeownership more accessible for veterans
  • •A down payment of 5% or more reduces your VA funding fee significantly
  • •Veterans with service-connected disabilities are exempt from the VA funding fee
  • •Consider all housing costs: utilities, maintenance, HOA fees, and repairs
  • •Pre-approval gives you a more accurate picture than estimates alone

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