Your home budget is based on how much you can afford to pay per month, which we calculate in the same way that mortgage lenders do—by comparing your income to your expenses and debts.
We include the monthly payments on the loan, average property taxes and homeowners' insurance fees nationally, and private mortgage insurance if applicable. We don't include utilities or homeowners' association dues.
Down payment- - , - %
Requires private mortgage insurance.
What is Private Mortgage Insurance (PMI)?
Many loans require a 20% down payment, but Federal Housing Administration (FHA) loans only require a minimum of 3.5%. These loans typically require Private Mortgage Insurance (PMI), which is included in this affordability calculation. It’s common for first-time buyers to buy a home with a down payment smaller than 20%.
Exceeds recommended debt-to-income ratio.
Follow the 28/36 Debt to Income Rule
Lenders recommend that your monthly debt payments be less than 36% of your income. You may find it difficult to afford these mortgage payments.