Your Mortgage Qualification Calculator

Mortgage Qualification Calculator

Calculate how much home you can afford based on your income and expenses

Financial Information

Gross Annual Income ($)

Monthly Debt Payments ($)

Mortgage Details

Length of the Mortgage 15 Years 30 Years 10 Years 20 Years

Down Payment ($)

Annual Interest Rate (%)

Additional Costs

Monthly Insurance ($)

Monthly Property Tax ($)

Mortgage Qualification Results

Maximum Home Price

$0

Estimated maximum home price you can afford

Monthly Mortgage Payment

$0

Estimated total monthly mortgage payment

Debt-to-Income Ratio

0%

Recommended to stay below 43% for most mortgages

Payment Breakdown

Payment Component	Monthly Amount	Percentage

This calculator provides estimates based on standard mortgage qualification guidelines. Actual loan terms may vary. Print Results

1. Introduction

A Mortgage Qualification Calculator helps homebuyers estimate how much they can borrow based on income, debts, and lender criteria. It answers:
✅ "How much house can I afford?"
✅ "Will I qualify for a mortgage?"
✅ "What’s my maximum loan amount?"

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2. Key Mortgage Qualification Factors

Lenders evaluate borrowers using four main metrics:

A. Debt-to-Income Ratio (DTI)

• Front-End DTI: Housing costs (mortgage + taxes + insurance) ÷ Gross monthly income (max 28%).

• Back-End DTI: All debts (housing + loans + credit cards) ÷ Gross monthly income (max 36-43%).

B. Credit Score

• Minimum score: 620 (conventional loans), 580 (FHA), 500 (some FHA with 10% down).

• Best rates: 740+.

C. Down Payment

• Minimum: 3-5% (conventional), 3.5% (FHA), 0% (VA/USDA loans).

• Ideal: 20% (avoids PMI insurance).

D. Loan-to-Value Ratio (LTV)

• Formula: Loan amount ÷ Home value (e.g., $200k loan on $250k home = 80% LTV).

• Lower LTV = Better rates.

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3. How the Calculator Works

Inputs Needed

1. Gross annual income ($60,000 → $5,000/month).

2. Monthly debts (car loan, student loans, credit cards).

3. Estimated property taxes & insurance (~1-2% of home value/year).

4. Down payment amount (e.g., $40k on $300k home = 13% down).

5. Loan term & interest rate (e.g., 30-year fixed at 6.5%).

Example Calculation

Factor	Amount
Annual Income	$75,000 ($6,250/month)
Monthly Debts	$500 (car + student loans)
Down Payment	$50,000 (20%)
Property Tax/Insurance	$400/month
Interest Rate	6.5% (30-year fixed)

Calculations:

1. Max Front-End DTI (28%): $6,250 × 0.28 = $1,750/month (PITI).

2. Max Back-End DTI (43%): $6,250 × 0.43 = $2,687/month (PITI + debts).

3. Affordable Mortgage Payment: $2,687 (total debt limit) – $500 (debts) – $400 (taxes/insurance) = $1,787/month principal + interest.

4. Loan Amount: ~$280,000 (at 6.5% for 30 years).

5. Home Price: $280k (loan) + $50k (down) = $330,000 max purchase price.

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4. Types of Mortgage Calculators

Type	Purpose
Pre-Qualification	Estimates borrowing power (soft credit check).
Pre-Approval	Lender-verified offer (hard credit check).
Refinance	Checks if refinancing saves money.
DTI Calculator	Focuses on debt-to-income ratio.

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5. How to Improve Qualification Chances

✔ Lower DTI: Pay off credit cards or loans.
✔ Boost Credit Score: Fix errors, reduce credit utilization.
✔ Save for Larger Down Payment: Reduces LTV & PMI costs.
✔ Choose a Longer Term: 30-year > 15-year for lower payments.

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6. Limitations

⚠ Pre-Approval ≠ Final Approval: Underwriting may change terms.
⚠ Rates Fluctuate: Quotes expire (typically 30-60 days).
⚠ Additional Costs: Closing costs (2-5% of loan) aren’t included.