Mortgage income calculator
The mortgage income calculator can determine your required salary to purchase
It’s a common question. How much income do I need to qualify for a mortgage? To answer that, you’ll need to look at a few different factors. Our mortgage income calculator helps you find the annual income you’ll need to buy a house by looking at the size of the mortgage, monthly debt payments, interest rates, loan terms and the related expenses to buying a home.
Income Needed Calculator
Our mortgage income calculator gives you a more detailed look
You’ll get a good idea of what your mortgage will look like based on your income and what you can afford. To use it, you will need to know:
- Sales price of the home–the purchase or listing price of the house you want to buy
- Down payment–the up-front amount you are planning to put down on the purchase of the home. It can be entered as a dollar amount or a percentage. Please note that any percentages over 99% will automatically be calculated as a dollar amount.
- Estimated interest rate–the rate that you expect to receive on your financing
- Property state–the state in which the house you are buying is located
- Estimated total monthly debts–the amount of debt (e.g., car loans, student loans, credit cards, etc.) that you pay each month. Note–do not include rent, utilities or other payments that will disappear or change when you move.
- Points charged–the origination fees and/or discount points charged by your lender. The standard is a 1% origination fee and zero points. If you do not know this information, assume a 1% origination fee.
Once you’ve filled in the mortgage income calculator fields, you’ll see a list of recurring payments associated with your home purchase. The mortgage calculator adds these up and tells you the income or salary that is needed to buy a home. If you’re wondering how we got to that number, see below:
- Total income needed–the mortgage income calculator looks at all payments associated with the house purchase and then aggregates that as a percentage of income. Most lenders require a borrower to keep housing costs at or below 28% of their pretax income. Total monthly debt payments (including housing costs) normally should not exceed 36% of pretax income. In some cases, Lenders may exceed the 28% / 36% guideline if the borrower meets certain requirements.