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California Home Loan Affordability Calculator

Estimate how much home you can afford in Orange County with our affordability calculator. Simply enter your annual income, monthly expenses, property taxes, insurance, down payment, estimated interest rate and loan term.

Southern California and Orange County are one of the least-affordable places to buy a home in the nation. To help you decide where to start your home search use the affordability calculator.


You can afford up to

Monthly Payment

Principal & Interest



Why Should I Use The Home Loan Affordability Calculator?

The short answer? To be truly ready to apply for a home loan, during the planning stages of your mortgage you’ll need an estimate of your monthly mortgage payments before you commit.

Can you afford a home loan at a certain price point combined with your other financial obligations? Your lender will definitely ask that question, and you’ll need to know the answer long before you apply.

Buying a home is a complex process. There are up-front fees, mortgage insurance, costs that are paid by the seller (and option you can choose to negotiate with the seller of the home), and there are charges your lender issues as a typical part of doing business with home loans.

If you are new to all this, using the calculator will help you to understand what information you need when it’s time to get pre-qualified or pre-approved.

And it will also help you understand the costs of your loan and how much to save. Using a home loan calculator early in your planning process helps you set realistic financial goals for saving and planning for your mortgage.

How To Use The Home Loan Affordability Calculator

To use the mortgage calculator you will need to prepare by gathering some information including a home sale price, potential property taxes, etc.

If you have not started house hunting yet, look at some local listings for the size and type of property you want to buy and use that as an initial guide.

You can estimate what you think you can afford and make adjustments from there. Having an estimated price of the property is important for estimating your property taxes, and you’ll also have to think about how much you want to use as a down payment.

The full list of things you’ll need to run in your home loan calculator includes:

  • Annual Income
  • Monthly Debts
  • Estimated annual property taxes
  • Estimated Annual Home Insurance
  • Down Payment
  • Interest Rate
  • Loan Term

The loan length for a typical mortgage is either 15 or 30 years, especially for government-backed mortgages like FHA and USDA loans.

Homeowner’s insurance will affect the amount of money you spend on your mortgage each month, but keep in mind that homeowner’s insurance and mortgage insurance are two different things.

Mortgage insurance is typically required on FHA loans for either 11 years or the lifetime of the loan (depending on certain variables including your down payment), and for conventional mortgages you may find that putting 20% down gets you out of paying mortgage insurance.

Interest Rates

Interest rates should always be calculated conservatively. Your lender will offer you an interest rate based on several factors and one of those factors is your credit score. It’s a good idea to contact a lender and ask what interest rates are typically offered to people with your credit score range.

How Are Mortgage Payments Calculated?

The actual amount you’ll be required to pay in monthly mortgage payments is calculated by adding all the monthly expenses associated with your mortgage loan (see below) together including interest and dividing by the number of payments required.

This calculation is more complicated than just listing your principal balance, calculating the interest, and dividing by the loan term. The following variables will all need to be included in your mortgage payment calculation:

  • Principal balance
  • Interest rate
  • Loan term
  • Property taxes
  • Any applicable Homeowners Association or Condo Owners Association fees
  • Any applicable insurance

It may take some time to gather such information but it is definitely worth the effort. Your lender will be examining your income, employment, and credit use to decide whether or not you make a good credit risk.

Part of that includes adding up your monthly debts and the projected monthly mortgage payment to see how much of your income is taken up by financial obligations.

Knowing that, you can run those numbers yourself in the early stages of your home loan preparation. If your debt ratio is too high you can work to reduce it in the meantime, but first you have to know how expensive your mortgage payment might be.

Debt ratio maximums may vary from lender to lender, but in general try to get your debt ratio below 43% for best results. That basically means you should have a goal of using no more than 43% of your monthly income to pay your financial obligations each month.

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