Mortgage Qualifier Calculator

The first step in buying a house is determining your budget. The mortgage qualifier calculator walks you through the process of finding out how much you can borrow. You can calculate your mortgage qualification based on income, purchase price or total monthly payment.

Definitions

Annual income
Your annual income before taxes. For joint applicants this is your total combined annual income before taxes.

Purchase price
The price of the home you wish to purchase. This is the actual price you'll pay, not including any closing costs.

Total monthly payment
Total monthly payment that you can qualify for. This is the total of principal, interest, taxes and insurance paid each month, often called PITI.

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.

Interest rate
The current annual interest rate you can receive on your mortgage.

Property tax rate
Your property tax rate. 1% for a $100,000 home equals $1,000 per year in property taxes.

Home insurance rate
Your home owner's insurance rate. 0.5% for a $100,000 home equals $500 per year for homeowner's insurance.

Show schedule by month
Select to show the payment schedule by month or year when you press the "View Report" button.

Cash on hand
Cash you have for the down payment and all closing costs.

Loan origination rate
The percentage the lending institution charges for its origination fee. 1% for a $100,000 home equals $1,000.

Number of points paid
The total number of points paid to reduce the interest rate of your mortgage. Each point costs 1% of your mortgage balance.

Other closing costs
Estimate of all other closing costs for this loan. This should include filing fees, appraiser fees and any other miscellaneous fees paid.

Limit downpayment
Limit your downpayment to percentage required to eliminate the need for PMI payments. Even if you have more cash on hand than required for closing costs, checking this box will limit your down payment to the minimum amount required to forego PMI.

Monthly car payment(s)
Total monthly payment for your car loan(s).

Credit card payments
Total monthly minimum payments for your credit cards.

Other loan payments
Any other installment loan payments, such as student loans or unsecured loans.

Total closing costs
Total upfront costs to close your loan. This is the total of your loan origination fee, points paid and other closing costs.

Monthly PMI payment
Monthly cost of Principal Mortgage Insurance (PMI). For loans secured with less than 20% down, PMI is estimated at 0.5% of your loan balance each year. Monthly PMI is calculated by multiplying your starting loan balance by this percent and dividing by 12. When the equity in your home exceeds the percentage required for PMI, your PMI payment drops to zero. Please note that this is only an estimate of your actual PMI. The amount you may be required to pay may be higher or lower than our estimate.

Monthly PI payment
Monthly principal and interest payment.

Total for down payment
Total funds remaining, after closing costs, for down payment.

Total annual income debt percentage
Not shown. This is the percentage of your annual income your financial institution allows you to use for debt installment payments. This includes car payments, credit card payments, other loan payments and your principal, interest, taxes and insurance payment for your home. The default rate is 36%.

PITI annual income percentage
Not shown. This is the percentage of your annual income your financial institution allows you to use for your principal, interest, taxes and insurance payment for your home. The default rate is 28%.

Information and interactive calculators are made available to you as self-help tools for your independent use and are not intended to provide investment advice. We cannot and do not guarantee their applicability or accuracy in regards to your individual circumstances. All examples are hypothetical and are for illustrative purposes. We encourage you to seek personalized advice from qualified professionals regarding all personal finance issues.