Real Estate and Economic Insights
Tools / Home Buying

Home Buying Calculator

Calculate monthly mortgage payments, determine how much home you can afford, or estimate qualification based on your income.

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Monthly Payment (P&I)
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Principal & Interest

Understanding Home Affordability

Determining how much home you can afford involves balancing your income, existing debts, down payment, and current interest rates. This calculator helps you explore different scenarios from multiple angles.

The 28/36 Rule

Conventional lenders typically use the 28/36 rule as a guideline for qualification:

28% Front-End Ratio Maximum percentage of gross monthly income that should go toward housing costs (PITI)
36% Back-End Ratio Maximum percentage of gross monthly income for all debt payments combined

Monthly Payment Formula

M = P × [r(1+r)ⁿ] / [(1+r)ⁿ – 1]

Where M is the monthly payment, P is the principal (loan amount), r is the monthly interest rate, and n is the total number of payments.

Additional Costs to Consider

Property Taxes 0.5% – 2.5% annually
Homeowners Insurance $1,000 – $3,000/year
PMI (if <20% down) 0.5% – 1% of loan/year
HOA Fees $0 – $500+/month
Maintenance 1% – 2% of value/year

Note: This calculator provides estimates for principal and interest only. Your actual monthly housing costs will include property taxes, insurance, and potentially PMI and HOA fees. Always consult with a mortgage professional for accurate qualification.