Follow Home Calculator

Determine how much you can afford to spend on a home by calculating your maximum mortgage payment based on your income and expenses. This calculator helps you understand your housing budget and make informed financial decisions.

How to Use This Calculator

To use the Follow Home Calculator:

Enter your gross monthly income before taxes.
Enter your monthly debt payments (including credit cards, car loans, etc.).
Enter your desired monthly savings amount.
Click Calculate to see your maximum affordable mortgage payment.

The calculator will show you how much you can realistically allocate to your mortgage while maintaining your financial goals.

Formula Used

The maximum affordable mortgage payment is calculated using the following formula:

Maximum Mortgage Payment = (Gross Monthly Income - Monthly Debt Payments - Monthly Savings) × 28%

The 28% rule is a common guideline in real estate that suggests you should not spend more than 28% of your gross monthly income on housing expenses. This leaves room for other essential expenses.

Worked Example

Let's say you have:

Gross monthly income: $5,000
Monthly debt payments: $800
Desired monthly savings: $300

Using the formula:

Maximum Mortgage Payment = ($5,000 - $800 - $300) × 28% = $3,900 × 0.28 = $1,092

This means you can afford a mortgage payment of approximately $1,092 per month.

Frequently Asked Questions

What is the 28% rule in real estate?

The 28% rule is a guideline that suggests you should not spend more than 28% of your gross monthly income on housing expenses. This leaves room for other essential expenses like debt payments and savings.

How accurate is this calculator?

This calculator provides an estimate based on common financial guidelines. For precise financial advice, consult with a certified financial planner or mortgage advisor.

Should I include all my debts in the calculation?

Yes, include all your monthly debt payments to get a more accurate estimate of your available housing budget.