Enter your monthly income and expenses, then choose a target debt ratio (DTI). The tool estimates your maximum monthly payment and the loan amount you could borrow for a given interest rate and duration.
How this borrowing capacity calculator works
This borrowing capacity calculator estimates your maximum affordable monthly loan payment and an indicative maximum loan amount based on your monthly income, recurring expenses, a target debt-to-income ratio (DTI), an interest rate and a loan duration.
The tool first applies the chosen debt ratio to your income to compute a theoretical maximum total debt payment. It then subtracts your recurring expenses to estimate what could remain available for a mortgage or loan payment.
The estimated loan amount is calculated using a standard present value formula for a fixed-rate loan. This result is indicative: lenders may also include borrower profile, insurance, fees, remaining disposable income, existing loans, and underwriting policies.
Disclaimer: this tool provides a simplified estimate and is not financial advice.