If you’re starting your homebuying journey, one of the biggest questions on your mind is probably:
“How much house can I actually afford?”

Spoiler alert: It’s not just about what a lender says you can afford — it’s about what’s comfortable for you. And the good news? You don’t have to guess. Here’s how to calculate it like a pro.

💡 Why You Shouldn’t Just Rely on Online Calculators

Online mortgage calculators are a great starting point, but they’re often oversimplified. They typically don’t include key costs like:

  • Property taxes
  • Homeowners insurance
  • HOA dues
  • Private mortgage insurance (PMI)
  • Maintenance and repairs

If you only look at principal and interest, you’re not getting the full picture and that could lead to buyer’s remorse.

âś… Step 1: Understand the 28/36 Rule

Lenders often use the 43/50 rule to determine what you can afford:

  • 43% of your gross monthly income or less should go toward your housing expenses
  • 50% or less should go toward all debt (mortgage, credit cards, car loans, student loans, etc.)

đź“Ś Example:

If you earn $6,000/month before taxes:

  • 43% = $2580 for total housing costs
  • 50% = $3000 for all monthly debts

đź’° Step 2: Know Your Monthly Budget

Ask yourself:

  • How much am I currently paying in rent?
  • Can I comfortably pay more?
  • What lifestyle expenses (travel, savings, daycare) do I want to keep?

Just because you’re approved for a $3,000/month mortgage doesn’t mean you should take it. Stick to a number that fits your life.

đź“‘ Step 3: Factor in the True Monthly Payment

Your monthly mortgage payment includes:

  • Principal & Interest (based on loan amount & rate)
  • Taxes (usually 1–2% of home price annually)
  • Insurance
  • PMI (if putting down less than 20%)
  • HOA Fees (if applicable)

Let’s say you’re looking at a $400,000 home:

  • 5% down = $20,000
  • Loan = $380,000
    At 6.5% interest for 30 years, the base payment is about $2,400/month but once you add in taxes, insurance, and PMI, your full payment could be closer to $3,000/month.

🧾 Step 4: Get Pre-Approved (Not Just Pre-Qualified)

A pre-approval gives you a clear idea of your max budget and it makes your offer stronger when you’re ready to buy.
It involves verifying:

  • Income
  • Credit score
  • Assets
  • Employment

Pro tip: Getting pre-approved doesn’t mean you have to spend the full amount you’re approved for.

🛠️ Bonus Tip: Use a Mortgage Broker (Like Me!) to Help You Crunch the Numbers

I work with multiple lenders to help you:

  • Find the best interest rate
  • Maximize your buying power
  • Understand what’s truly affordable based on your full financial picture
  • Find a mortgage option that best fits your needs

No pressure. Just real numbers and smart advice.

🎯 Final Thoughts: Know Your Number Before You Shop

House hunting is exciting but knowing your budget ahead of time helps you avoid heartache, wasted time, and financial stress. Don’t guess. Know what you can afford, and shop with confidence.

đź‘‹ Ready to Run the Numbers Together?

Whether you’re just getting started or want a second opinion, I’m here to help you figure out your comfort zone and explore your options.

đź“© Get in touch today to get pre-approved and start your home search the smart way!

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