Understanding the house affordability calculator
Lenders size mortgages with two debt-to-income ratios. The front-end ratio says your housing payment should stay under about 28% of gross monthly income; the back-end ratio says all debt payments together housing plus car loans, student loans, and credit-card minimums should stay under about 36%. This calculator applies whichever limit binds first, then converts the allowed payment into a loan amount at your rate and term.
Treat the result as a ceiling, not a target. The ratios ignore property taxes, insurance, maintenance, and your own savings goals, all of which come out of the same paycheck. Many buyers deliberately shop one bracket below what they qualify for so a rate rise or income dip does not turn the house into a burden.
Results are estimates for education only and are not financial advice.