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This Home Affordability Calculator will help you estimate the size of loan associated with the monthly mortgage payment you feel you can afford. This site also features a full Prequalification Calculator to help determine how much you can afford to borrow, and a Mortgage Payment Calculator to help determine the mortgage payment associated with a given loan amount.

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This Affordability Calculator does not factor in property taxes, mortgage insurance or hazard insurance. These expenses are billed annually, but they are often paid monthly through an escrow account. The total cost of these expenses can vary quite a bit.

Taxes can be assessed against the value of your property by your city, town, county, school district, state, and/or special taxing district. Altogether, annual property taxes can range from a low of 0% (no tax) to almost 2% of the home’s value. It’s best to learn what tax rate applies to your area. In the meantime, you can estimate annual taxes to run about 1% of the home’s value.

Mortgage insurance is usually estimated about half a percent of the home’s value per year, and is required if the principal balance on your loan is more than 80% of the loan’s value.

Hazard insurance (fire, flood, etc.) varies with the amount of risk associated with the property, which varies by location and other factors. If you don’t know, estimate that the yearly charge for hazard insurance will cost about three tenths of a percent of the home’s value.

Closing Costs are associated with purchasing a house and securing a home loan. These can be paid at closing. If not paid in full at the time of closing, the unpaid amount can be rolled into the loan, which will further increase your monthly payment.

All that said, we hope you’ll find this tool useful as a general indication of the size of home loan you can afford. Use the Prequalification Calculator for a more detailed and thorough examination of affordability.