How much house can I afford on $240,000 a year?
- Principal & interest
- $4,526
- Property tax & insurance (est.)
- $1,081
- Loan amount
- $716,000
- Total interest over 30 years
- $913,219
Affordable home price by interest rate
| Rate (30-yr fixed) | Home price | Loan amount | Principal & interest |
|---|---|---|---|
| 5.00% | $1,018,000 | $814,000 | $4,370 |
| 5.50% | $974,000 | $779,000 | $4,423 |
| 6.00% | $933,000 | $746,000 | $4,473 |
| 6.50% | $894,000 | $715,000 | $4,520 |
| 7.00% | $857,000 | $686,000 | $4,564 |
| 7.50% | $823,000 | $659,000 | $4,605 |
| 8.00% | $791,000 | $633,000 | $4,644 |
Affordable home price with other monthly debts
| Other debts / month | Home price at 6.5% |
|---|---|
| $0 | $894,000 |
| $300 | $894,000 |
| $500 | $894,000 |
| $800 | $894,000 |
| $1,200 | $894,000 |
Frequently asked questions
How much house can I afford making $240,000 a year?
About $894,000, assuming 20% down ($179,000), a 30-year fixed rate of 6.5% and no other debts. That keeps your total housing payment near $5,600 per month, 28% of your $20,000 gross monthly income.
What mortgage payment can I afford on $240k?
Lenders typically cap housing costs (principal, interest, taxes and insurance) at 28% of gross income — $5,600 per month — and all debts combined at 36%, or $7,200 per month.
How do car loans or student debt change this?
Every dollar of monthly debt above $1,600 reduces your housing budget dollar-for-dollar under the 36% rule. With $800/month of other debt you could afford about $894,000.
Related
Assumes 20% down (no PMI), 1.1% property tax and 0.35% insurance per year, and the 28/36 debt-to-income guideline. Lenders also weigh credit score, reserves and loan type. Educational estimate, not financial advice. Methodology.