How much house can I afford? Use our affordability calculator

When it comes to taking out a mortgage, the amount you’re approved to borrow doesn’t always reflect what you can comfortably afford. While lenders use financial formulas to estimate borrowing limits, true home affordability depends not only on your income and debt level, but also on your financial comfort, future plans, goals, spending habits and lifestyle.

These are the most important factors to consider when calculating exactly how much house you can afford.

The interest rate of your mortgage is a major factor in how much home you can afford. The higher the interest rate, the higher your monthly payment. See how much you can expect to pay:

How much house you can actually afford will vary depending on how much debt you have, your down payment and interest rate, and other expenses like property taxes and insurance.

Although circumstances vary, a good basic rule is to keep your monthly housing payment at or below one third of your total monthly household income before taxes and deductions.

Based on these rough guidelines, this is what buyers can generally afford by income:

*Estimates assume a 30-year fixed-rate mortgage, 20% down payment and mortgage cost equivalent to 25%–33% of gross monthly income.

Original source: https://www.usatoday.com/money/