Use this free online calculator to find out how much home you can afford


If you are in a temporary situation, renting may be optimal if you need a place to live. But anyone dealing with landlords and the less positive aspects of renting may wonder when it’s time to buy a home.

Buying a home is a complex, life-changing decision that shouldn’t be taken lightly, given that the average mortgage term is 30 years. If you already own a home and want to upgrade it, you need to know how much yours is worth. Click or click here to find out the actual value of your home for free.

Regardless of the situation when you are ready to buy a home, you need to know how much you can afford. Stop wondering and use this free online calculator to determine how much home you can afford.

What is included in the price of the house?

It’s easy to browse Zillow and see a house for $250,000 and think, hey, I can probably afford that. You may be able to afford it, but the list price is never the actual price of the home. Dozens of other factors and costs go into the price list, and they can add up.

RELATED: 5 Ways to Improve Your Home’s Zestimate on Zillow


You didn’t think the bank would let you borrow all that money for free, did you? In addition to finding a generous benefactor, you will need to take out a loan to buy your dream home. This means that you will have to pay interest on the borrowed amount.

Depending on the term of the loan, the amount you put down, and the interest rate, you could end up paying twice what the home is worth in the long run. This also affects your monthly payment.

Closing costs

If you’ve heard that lawyers are expensive, you don’t know the true meaning of that statement until you buy a home. Closing costs come with every sale and are usually 2 to 5% of the total price of the home. Some of the closing costs go to the lawyers who help facilitate the deal, and they don’t come cheap.

Property tax

Another sneaky hidden fee associated with buying a home is real estate taxes. This is also added to your monthly payment, which can vary widely depending on where you buy your home because each city determines its own tax rate.

Mortgage calculator online

If all of this information seems overwhelming, there’s an online tool to make it easier. Penny Hoarder uses information such as insurance, PMI and loan length to help determine how much your monthly mortgage will be.

The calculator tells you how much of your salary should be set aside for a mortgage. Spoiler alert: it’s 25%.

This free tool uses your monthly salary, loan size and terms, how much money you have for a down payment, and hidden cost factors to determine how much you can afford. Check it out so you know before you make that life-changing purchase.

Click or click here to access Penny Hoarders’ free online mortgage calculator.

Use this free online calculator to find out how much home you can afford

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