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Your debt-to-income ratio is a big factor when applying for a mortgage.
A home is likely the biggest purchase you will ever make, so be sure you end up with a monthly mortgage payment that feels comfortable. But how can you know what price range you should be shopping in for a new home? This mortgage affordability calculator will help you figure it out.
When you apply for a mortgage, mortgage lenders aren’t just interested in knowing how much you can bring to the table with your gross income, assets, and down payment. They also have to consider what kind of monthly debt payments and other monthly expenses have the potential to hold you back.
You could have a comfortable amount of take-home pay. However, if you’re also chipping away at credit card debt, paying weekly child support, and buried by student loans, you may not truly have much left every month to pay your mortgage, homeowner’s insurance, taxes, and other home maintenance costs.
This house affordability calculator will help you gain a clearer picture of your financial situation and whether or not there could be a new home in your future. You can plug in your combined annual income, along with any monthly payment obligations, and then experiment with new loan assumptions. Try different interest rates, down payment amounts, property taxes, and mortgage terms to see how they impact how much house you can afford.
This home affordability calculator may help you analyze your financial needs, but the calculations do not infer any fiduciary duties. The Embrace Home Loans mortgage calculator is just meant to be a helpful tool and calculations should not be construed as financial, legal, or tax advice. We cannot guarantee its accuracy and rates may change.