How this calculator works
It applies the widely used 28/36 rule of thumb: housing costs up to 28% of gross monthly income, and all debt payments — housing included — up to 36%. Your affordable monthly payment is whichever cap bites first, which is why existing debts pull the answer down. From that payment, the standard mortgage formula works backwards to the loan your rate and term support, and your deposit tops it up to a price.
- Income is gross (pre-tax) household income — that's what the ratios are defined against.
- Existing debts matter double: they consume the 36% cap and they're the first thing worth clearing if the result disappoints.
- Rate and term shift the answer a lot. Test a rate one point higher than today's — if the number stops working, so does the mortgage.
Common questions
What is the 28/36 rule?
A common lender rule of thumb: spend at most 28% of gross monthly income on housing costs, and at most 36% on all debt payments combined, housing included. It is a guideline for not overextending, not a legal limit, and specific lenders and countries use different thresholds.
Why is my result lower than a bank's offer?
Banks sometimes lend beyond conservative ratios, especially on long terms. A bigger offer is not a verdict that you can afford it comfortably — the 28/36 framing errs on the side of a life that still has room for saving and the occasional disaster.
Does the calculator include property taxes and insurance?
Not explicitly — those vary too much by country to guess honestly. Treat the affordable monthly payment as the total housing budget and mentally reserve part of it for taxes, insurance, and upkeep, especially where those costs are high.
How much deposit do I need?
It varies by market, but a larger deposit lowers the loan, the monthly payment, and often the rate you're offered. Our savings goal calculator can turn a target deposit into a monthly saving plan.
This tool is educational and not financial advice or a lending decision. Mortgage rules, taxes, and typical ratios vary significantly by country.
- 1.What is a debt-to-income ratio? — US Consumer Financial Protection Bureau
- 2.How much mortgage can you afford? — MoneyHelper (UK)