Maximum Mortgage

What is your maximum mortgage? That largely depends on your income and current monthly debt payments. This calculator collects these important variables and determines your maximum monthly housing payment and the resulting mortgage amount.

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Definitions

Monthly income

Total monthly income from all sources. All income should be entered before taxes.

Monthly housing expenses

Your monthly housing expenses from the housing expenses worksheet. The items entered as housing expenses make up the taxes and insurance portion of your monthly PITI payment.

Monthly liabilities

Your monthly liabilities from the liabilities worksheet. Your monthly liabilities are used to calculate your maximum PITI.

Monthly housing payment (PITI)

This is your total Principal, Interest, Tax and Insurance (PITI) payment per month. This includes your principal, interest, real estate taxes, hazard insurance, association dues or fees and principal mortgage insurance (PMI). Maximum monthly payment (PITI) is calculated by taking the lower of these two calculations:

Monthly Income X 28% = monthly PITI
Monthly Income X 36% - Other loan payments = monthly PITI

Maximum principal and interest (PI)

This is your maximum monthly principal and interest payment. It is calculated by subtracting your monthly taxes and insurance from your monthly PITI payment. This calculator uses your maximum PI payment to determine the mortgage amount that you could qualify for.

Start interest rates at

The current interest rate you could receive on your mortgage. This is used as the starting point for displaying a range of interest rates and the resulting mortgage amount.

Term in years

The number of years over which you will repay this loan. The most common mortgage terms are 15 years and 30 years.

It is suggested that you contact your attorney and/or your CPA or financial planner should you wish to discuss any tax or legal implications relative to your financial goals, the tax consequences of how you will hold title to your property, the tax deductibility of closing costs, points, and/or mortgage interest, and/or the legal and tax implications as to your purchase and/or sale of property or the refinancing of your mortgage.