Buying a home is one of the largest financial decisions you’ll ever make, and figuring out your price range before you start shopping can save you hours of frustration — and protect you from overcommitting. Lenders use two key ratios to decide how much they’ll approve: the front-end ratio (your housing costs vs. your gross income) and the back-end ratio (all debts vs. your gross income). Most conventional lenders want to see a front-end ratio below 28% and a back-end ratio below 36%.

Our calculator below uses both rules and shows you the more conservative of the two limits. That way you get a realistic ceiling, not just the theoretical maximum a lender might approve. Fill in your income, current monthly debts, expected down payment, and the interest rate you’ve been quoted — the tool does the rest.

What this calculator factors in:

  • Principal and interest on the mortgage
  • Monthly property taxes (estimated from your local rate)
  • Homeowner’s insurance
  • PMI if your down payment is less than 20% of the home price

One thing to know upfront: pre-qualification and pre-approval are different things. A calculator gives you a planning number; a lender pre-approval letter gives you buying power. Use this tool to narrow your search, then get pre-approved before making offers.

How Much House Can You Afford?

What Do the Results Mean?

The max home price is the purchase price our model says you can afford while staying within healthy debt-to-income limits. The max loan amount is that price minus your down payment. The estimated monthly payment combines principal, interest, taxes, insurance, and PMI if applicable.

If your down payment is below 20%, PMI typically costs 0.3%–1.5% of your loan balance per year. Once your equity reaches 20%, you can request cancellation.

Tips to Increase Your Buying Power

  1. Pay down existing debt. Eliminating a car payment or credit card balance directly reduces your back-end DTI and can shift your price ceiling by tens of thousands.
  2. Increase your down payment. A larger down payment reduces your loan balance, lowers your monthly payment, and eliminates PMI once you cross 20%.
  3. Improve your credit score. A score above 740 typically unlocks the best rates. Even a 0.5% rate improvement meaningfully increases what you can afford.
  4. Consider a longer loan term. A 30-year loan has lower monthly payments than a 15-year loan, which increases affordability — though you’ll pay more interest overall.

Remember that just because a lender will approve you for a certain amount doesn’t mean you should borrow that much. Many financial planners recommend keeping housing costs under 25% of take-home pay (not gross income), giving yourself room for savings, emergencies, and life.

This calculator provides estimates for planning purposes only. Actual mortgage approval depends on your credit score, employment history, loan type, and lender guidelines. Work with a licensed mortgage professional before making any purchase decisions.