Maximum Mortgage Calculator
Find the largest mortgage and home price you can qualify for based on your income, debts and a lender’s debt-to-income limit.
A worked example
Running this tool on current national benchmarks (Federal Reserve / Freddie Mac via FRED (St. Louis Fed)) — swap in your own numbers to see how the result moves.
- Gross monthly income
- $7,000
- Other monthly debt payments
- $600
- Max debt-to-income ratio
- 43%
- Interest rate
- 6.50%
- Loan term (years)
- 30
- Down payment available
- $50,000
- Est. taxes + insurance / month
- $450
$310,093 loan + $50,000 down
- Affordable payment (P&I)$1,960.00
- Maximum loan$310,093
- Maximum home price$360,093
How the maximum home price changes with gross monthly income
Holding the other inputs at the example above, here is how the result moves as gross monthly income changes.
| Gross monthly income | Maximum home price | Affordable payment (P&I) |
|---|---|---|
| $5,000 | $224,032 | $1,100.00 |
| $7,000 | $360,093 | $1,960.00 |
| $10,000 | $564,185 | $3,250.00 |
| $15,000 | $904,338 | $5,400.00 |
The math behind it
First the calculator finds the biggest total monthly debt a lender will allow — your gross monthly income times the debt-to-income limit you set. It subtracts your existing debt payments and your estimated monthly taxes and insurance, and what is left is the payment available for principal and interest. That affordable payment is then run backward through the standard amortization formula at your rate and term to find the largest loan it can support. Adding your down payment gives the maximum home price.
Assumptions & limits
- The affordable payment covers principal and interest only. Property taxes and insurance are entered separately and subtracted before the loan is sized.
- The debt-to-income limit you set caps total monthly debt, not just the mortgage — existing car, card, and student-loan payments reduce what is left.
- A single fixed interest rate is assumed for the whole term.
- PMI, HOA dues, and closing costs are not modeled. If you put less than 20% down, PMI would further reduce the payment available for principal and interest.
- The result is a lending ceiling, not a recommendation — qualifying for an amount is not the same as it being comfortable to carry.
Common debt-to-income limits
The share of gross monthly income a lender allows for total debt. The calculator lets you set your own; these are typical reference points.
| Loan type | Typical back-end DTI |
|---|---|
| Conventional (automated approval) | Up to 45%, sometimes 50% |
| FHA | Often up to 43%, higher with compensating factors |
| Conservative rule of thumb | 36% |
Source: Freddie Mac PMMS via FRED. Annual averages; latest weekly reading shown.
Common questions
Is the maximum mortgage the amount I should borrow?
No. It is the largest loan a lender's debt-to-income limit would allow, not a target. Borrowing at the ceiling leaves little room for emergencies, maintenance, or rate changes on other debt. Many buyers deliberately borrow below their maximum.
Why does a higher interest rate lower my maximum loan?
Your affordable payment is fixed by your income and DTI limit. At a higher rate, more of each payment goes to interest, so the same payment supports a smaller principal. The schedule in the results shows exactly how the maximum loan shrinks as the rate rises.
Does my down payment change how much I can borrow?
The down payment does not change the maximum loan, which is set by your payment capacity. It adds directly to the maximum home price, though — a larger down payment buys a more expensive home at the same loan size, and can also help you avoid PMI.