FHA Loan Affordability Calculator

Calculate how much house you can afford with an FHA loan based on your income, debts, and down payment.

Affordability Calculator
About This Calculator

How Much House Can I Afford?

Enter your financial details below to calculate your FHA home buying budget.

Income & Debts

Gross income before taxes and deductions.
Car loans, student loans, credit cards, etc.

Down Payment & Loan Details

FHA loans require a minimum 3.5% down payment.
Current FHA interest rates typically range from 5.0% to 6.5%.

Additional Expenses

Typically 0.5% to 2.5%, varies by location.
Typically 0.3% to 0.7% of home value.
If applicable. Enter 0 if no HOA fees.

Understanding Home Affordability

When determining how much house you can afford with an FHA loan, lenders consider several factors:

Debt-to-Income (DTI) Ratios

  • Front-End Ratio: Housing costs should not exceed 31% of your gross monthly income.
  • Back-End Ratio: Total debt payments (including housing) should not exceed 43% of your gross monthly income.

FHA Loan Requirements

  • Minimum Down Payment: 3.5% with a credit score of 580+
  • Mortgage Insurance: Required for all FHA loans
  • Credit Score: Minimum 580 for 3.5% down payment

Our calculator uses these guidelines to estimate your maximum affordable home price based on your income, debts, and available down payment.

Key Factors That Affect Your Home Buying Budget

Income & Employment

Your income is the foundation of your home buying budget. FHA lenders typically look for:

  • Steady employment history (2+ years preferred)
  • Reliable income sources
  • Potential for future income growth

Higher income generally means you can afford a more expensive home, but other factors like debt and credit also play important roles.

Debt & Obligations

Existing debt reduces how much you can borrow. Lenders consider:

  • Car loans and leases
  • Student loans
  • Credit card minimum payments
  • Personal loans
  • Child support or alimony
  • Other recurring debt obligations

Reducing debt before applying for a mortgage can significantly increase your home buying budget.

Down Payment

Your down payment affects both affordability and loan terms:

  • Minimum 3.5% down payment for FHA loans with 580+ credit score
  • 10% down payment required for credit scores 500-579
  • Larger down payments reduce loan amount and monthly payments
  • Down payments ≥10% allow MIP removal after 11 years

FHA allows down payment funds to come from gifts or down payment assistance programs, making homeownership more accessible.

Credit Score

Your credit score affects FHA loan eligibility and terms:

  • Minimum 580 for 3.5% down payment
  • 500-579 requires 10% down payment
  • Higher scores may qualify for better interest rates
  • Recent bankruptcies or foreclosures may require waiting periods

While FHA loans have more flexible credit requirements than conventional loans, improving your credit score can still help you get better terms.

Interest Rates

Interest rates have a significant impact on affordability:

  • Lower rates increase your buying power
  • A 1% rate difference can change affordability by 10%
  • FHA rates are often competitive, especially for lower credit scores
  • Rate locks can protect you from increases during the home buying process

Shopping around for the best FHA lender can help you secure the most favorable interest rate for your situation.

Property Expenses

Ongoing property costs affect your monthly payment:

  • Property taxes (vary significantly by location)
  • Homeowners insurance
  • HOA or condo fees (if applicable)
  • Maintenance and repairs (typically 1-3% of home value annually)
  • Utilities (often higher than in rentals)

Don't forget to budget for these ongoing expenses when determining your maximum price range.

Tips to Increase Your Home Buying Budget

Before Applying for an FHA Loan

  1. Improve Your Credit Score

    Pay down credit card balances, make all payments on time, and avoid opening new credit accounts. A higher credit score can help you qualify for better interest rates.

  2. Reduce Existing Debt

    Pay off or pay down smaller debts to improve your debt-to-income ratio. This can significantly increase your home buying budget.

  3. Save for a Larger Down Payment

    While FHA loans require just 3.5% down, a larger down payment reduces your loan amount and monthly payments. With 10% down, MIP can be removed after 11 years.

  4. Increase Your Income

    Consider asking for a raise, taking on a part-time job, or finding other income sources. Lenders typically want to see stable income for at least two years.

  5. Check for Down Payment Assistance

    Many states and local governments offer down payment assistance programs that can be used with FHA loans. These can help you afford more house with less money out of pocket.

During the Home Buying Process

  1. Shop Around for Lenders

    Different FHA-approved lenders may offer different interest rates and terms. Even a small rate difference can significantly impact your affordability.

  2. Consider a Longer Loan Term

    A 30-year loan will have lower monthly payments than a 15-year loan, potentially allowing you to afford a more expensive home.

  3. Look in Different Locations

    Property taxes and insurance costs vary by location. Areas with lower property taxes can allow you to afford a higher-priced home.

  4. Consider a Fixer-Upper

    FHA 203(k) loans allow you to finance both the purchase and renovation of a home. This can help you buy a more affordable property and improve it to meet your needs.

  5. Be Realistic About Additional Costs

    Remember to budget for moving expenses, furniture, immediate repairs, and ongoing maintenance when determining your maximum price range.

Explore Our Other FHA Calculators

Basic FHA Calculator

Simple calculator with essential inputs for a quick FHA loan payment estimate.

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DTI Calculator

Calculate your debt-to-income ratio to see if you qualify for an FHA loan.

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FHA vs Conventional

Compare FHA and conventional loans side-by-side to see which is better for you.

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