Several factors determine how much house you can afford. But it goes beyond just the financial basics a typical lender would review.

1. August 2021
Back to blog
With interest rates at historic lows and a red hot real estate market, you are probably wondering, “How much
house can I afford? Well, the answer can be pretty simple if you use a tool like the Affordability Calculator. All it
takes is inputting a few essential financial details and determining your lifestyle to figure out how much you
can comfortably afford.
How Much House Can I Afford Calculator
Several factors determine how much house you can afford. But it goes beyond just the financial basics a
typical lender would review. To truly feel comfortable buying a home, it’s essential to consider how much you
love the gym and streaming services. That’s why our Affordability Calculator is so valuable because you walk
away with a house price that won’t impede on the lifestyle you love. Here’s how to do it.
Start With The Basics
Some foundational financial factors are required for anyone wondering, “how much house can I afford?” These
include:
Calculate Primary Monthly Expenses
Once you’ve determined all your basic expenses, the next step in the Affordability Calculator is totaling up your
debts. This is key because a lender looks at your debt-to-income ratio (DTI) to gauge your ability to handle the
monthly payments and repay the loan. A lower DTI means they’re more likely to lend you the money you want.
So, that’s why it’s important to input all your debts.
The Affordability Calculator makes it easy by breaking it down into four typical debts:
Lenders usually like a DTI smaller than 36%, with housing expenses not exceeding 28% of your monthly income.
But, other factors like your credit score could qualify you for more. That’s why having a calculator is helpful to
consider all variables when it comes to answering “how much house can I afford?”
Consider Your Lifestyle
A major detail most lenders overlook when determining how much house you can afford is your lifestyle
preferences. How much do you enjoying (and spend) dining out? Could you live without Netflix? These
questions are essential when looking at affordability since you want to be happy in your new home and not
house poor. That’s why our Affordability Calculator takes the extra step to ask for financial information regarding
your lifestyle.
Here you can input an overall number of your monthly lifestyle expenses. Or, click “In Details,” and you’ll be
prompted with 12 boxes that cover typical lifestyle costs. This covers things like monthly utilities, donations, pet
care, and more.
Why an Affordability Calculator Helps You
When trying to answer the question “how much house can I afford,” many factors are considered. The
Affordability Calculator does that for you with easy-to-answer prompts. After taking a few minutes to input all
the information, you’ll receive a number that says how expensive a home you can afford.
You can toggle between a conservative price and an aggressive one to see how the monthly payments would
change and your DTI. The calculator further breaks down the total loan amount, interest rate, APR, and what
you have leftover.
Now, you have a better understanding of how much house you can afford and start your home search.
Buying a Home Financial Tips Share post:
Was this article helpful? Yes No 0 out of 0 found this helpful
“How Much House Can I Afford?”
Yearly Gross Income: Enter your total annual household income before taxes and deductions.
Down Payment: How much you can put down will determine the loan amount and monthly mortgage
payment. You could put down the traditional 20% of the purchase price or as little as 3% (which will require PMI
insurance).
Zip Code: Towns have different tax rates and loan limits that will determine affordability. That’s why you need to
input where you are looking to buy a home.
Credit Score: Your credit score plays a signi cant role in the interest rate you’ll get and, ultimately, your monthly
mortgage payment.
Property Taxes: Towns have different tax rates, which is why you need to input the average yearly taxes you
expect to pay in your area of interest. That will play a huge role in answering how much house can I afford? If you
don’t know the tax rate, simply leave it blank and Get A Rate will auto calculate them based on the zip code
entered.
Loan Term: This is how many years you have to pay back the loan. The standard amount is 30 years, but you can
choose 20, 15, or 10. Whichever you choose will affect your monthly mortgage payment and how much can you
can afford.
Annual Homeowners Insurance: Get A Rate automatically calculates this for you based on an average. But, if
you have an exact insurance quote, enter that for even more accurate results.
Military/Veteran Status: Members of the military and veterans can get low-interest loans and qualify for 0%
down payments, both of which will determine affordability.
Marital Status: Your marital status will help identify any tax write offs you might receive, which ultimately helps
determine how much you’ll have leftover after accounting for all your taxes. Again, knowing the full picture of
what goes in and out of your pocket in a year helps with understanding what you can afford.
Number of Dependents: Like marital status, the number of dependents you claim on your taxes will indicate
any additional tax write-offs.
Car Payments: How much do you pay for your car each month?
Credit Card Payments: If you aren’t paying your credit card bill in full each month, you should input how much
you pay monthly towards that debt.
Student Loan: Input how much you put toward student loan debt each month.
Other Monthly Payments: Here is where you’d input any other debts like monthly alimony or child support
payments.
Related posts
December 2015
Keeping Your Financial Home
In Order
So you found “the one”. Now it’s time
to lock in your financing to secure
your dream home. ...
Financial Tips
September 2016
[Top 7 Home Buying Tips]:
How To Protect Yourself &
Determine If It’s The Right
Time To Buy A Home
Michael Sema sits with One America
News Network's Liz Wheeler on
the Tipping Point to discuss why h...
Buying a Home
October 2017
Re nance Costs: To Pay Or
Not to Pay?
Most homeowners understand how a
refinance could benefit them but
many homeowners don’t realize there
are v...
Financial Tips Re nancing
July 2015
Top 5 Insane But True
Reasons To Buy A Home
Did you ever want to buy a home, day
dream about it but then shake your
head thinking, “It would be nice…...
Buying a Home
Sign in
Get Started
Purchase Re nance View Rates FAQs About Us
Learn Of ces

2. Tools
Purchase Calculator
Refinance Calculator
Affordability Calculator
Rent vs Buy Calculator
Credits / Points Calculator
Programs
Comparison
30 Years Fixed
15 Years Fixed
FHA Loan
VA Loan
About Us
Company
Information
Press Room
Careers
Testimonials
Contact
Learn
Blog
FAQs
Of ces
NJ Office
FL Office
GA Office
CA Office
© 2021. Get A Rate LLC. All Rights Reserved
NMLS #907795 Licensed Residential Mortgage Lender in CA, WA, GA, TX, PA, CT, FL, SC, IL and NJ (by the NJ Department of Banking and Insurance).
Equal Housing Opportunity Lender. When and if acting as a broker, Get A Rate will not make commitments or fund mortgage loans. Registered NY
Mortgage Broker. All NY mortgage loans are arranged with third party lenders – Get A Rate LLC does not directly offer or guarantee NY interest rates
or loan programs and does not directly issue commitments or make final decisions on loan terms. This website is not authorized by the NYDFS and
that no applications can be taken for NY loans on the site.
Get A Rate LLC is an FHA Approved Direct Lending Institution, and is not acting on behalf of or at the direction of HUD/FHA or the Federal
government. These programs are not a commitment to lend and program guidelines are subject to change.
Additional Disclosures
Home / HUD & RESPA / State Licenses & Disclosures, Terms & Conditions, Privacy Policy / 888-562-2611 / Rate Lock Policy / NMLS Consumer Access
Sign in
Get Started
Purchase Re nance View Rates FAQs About Us
Learn Of ces