💼 Borrowing Capacity Calculator
Calculate how much you can borrow based on your income, expenses, and existing debts. Get an instant estimate of your maximum loan capacity.
💰 Income
💳 Monthly Expenses & Debt
⚙️ Loan Parameters
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About Borrowing Capacity Calculator
This borrowing capacity calculator helps you estimate the maximum amount you can borrow for a mortgage based on your income, expenses, and existing debt obligations. Lenders typically use debt-to-income ratios to determine how much you can safely borrow.
Features
- Multiple Income Sources: Include your salary, co-applicant income, and other income sources like rentals or investments.
- Comprehensive Debt Analysis: Factor in all monthly obligations including credit cards, car loans, and other debts.
- Customizable Parameters: Adjust interest rates, loan terms, and debt-to-income thresholds to match your situation.
- Maximum Home Price: See the total home price you can afford when combining your down payment with borrowing capacity.
- Visual Debt Ratio: Clear visualization of your debt-to-income ratio to understand your financial position.
- Real-time Updates: Results adjust instantly as you modify any input field.
Use Cases
- First-Time Home Buyers: Understand your budget before starting your home search.
- Refinancing Planning: See if you can afford to borrow additional funds during refinancing.
- Financial Planning: Evaluate how additional income or paying off debt affects borrowing power.
- Debt Management: Understand how reducing existing debts can increase your borrowing capacity.
- Pre-Approval Preparation: Get realistic expectations before meeting with lenders.
How to Use
- Enter Income: Add your gross annual income (before taxes). Include co-applicant and other income if applicable.
- List Expenses: Enter your monthly living expenses and all debt payments (credit cards, car loans, etc.).
- Set Loan Parameters: Input expected interest rate, desired loan term, and your available down payment.
- Adjust DTI Ratio: Most lenders use 36-43% debt-to-income ratio. Conservative: 36%, Standard: 43%.
- Review Results: See your maximum loan amount, affordable home price, and financial ratios.
- Optimize: Experiment with different scenarios to maximize your borrowing capacity.
Privacy & Security
- 100% Client-Side: All calculations happen in your browser - no data is sent to any server.
- No Data Storage: Your financial information is never saved or tracked.
- Instant Results: Fast calculations without any network requests.
- Private & Secure: Your financial planning remains completely confidential.
💡 Understanding Debt-to-Income Ratio
What is DTI? Your debt-to-income ratio is the percentage of your monthly gross income that goes toward paying debts. Lenders use this to assess your ability to manage monthly payments.
Conservative (28/36 Rule): 28% max for housing costs, 36% max for total debt. This leaves more financial cushion.
Standard (43% Rule): Maximum 43% of gross income for all debt including the new mortgage. This is the typical upper limit for qualified mortgages.
Improving Your Capacity: Pay down existing debts, increase income, or save a larger down payment to maximize borrowing power.
Note: This calculator provides estimates. Actual loan approval depends on credit score, employment history, assets, and lender-specific criteria. Always consult with mortgage professionals for accurate pre-approval.