Enter income, debts, and loan details in minutes. Preview today’s payment and worst-case payment side-by-side. Adjust plans before higher rates shrink your options too.
| Home price | Down payment | Term | Current rate | Shock rate | Income | Other debts | Escrow | P&I current | P&I shock | DTI shock |
|---|---|---|---|---|---|---|---|---|---|---|
| $450,000 | $90,000 | 30y | 6.50% | 8.50% | $9,000 | $900 | $650 | $2,276.79 | $2,768.41 | 48.2% |
Monthly principal & interest payment uses the standard amortization payment formula:
Debt-to-income ratio is computed as:
The tool also reverses the payment formula to estimate the maximum loan supported by a target monthly payment at each interest rate.
Mortgage affordability is highly sensitive to interest rates because most payments are interest-heavy in early years. A two-point increase can raise monthly principal and interest by hundreds, shifting your debt-to-income ratio even when your home price stays the same.
The calculator compares two scenarios: a baseline rate and a stressed “shock” rate. It computes monthly principal and interest, adds escrow and HOA to estimate housing cost, then adds other debts to calculate total monthly obligations. The key output is DTI, which is total obligations divided by gross monthly income.
The affordability gap compares your buffered housing budget to the housing cost under the shock rate. If the gap is positive, you still have room within your target. If it is negative, the stressed payment pushes you beyond your planned limit. In the sample scenario, a $360,000 loan over 30 years moves from about $2,276.79 to $2,768.41 in P&I as rates rise from 6.50% to 8.50, a change of roughly $491.62 per month (about 21.6%).
Many planning models use total DTI targets between 0.36 and 0.43, but your comfort level, job stability, and savings matter. The optional stress buffer reduces the allowed housing budget so you keep extra margin for utilities, maintenance, or variable expenses. With $9,000 income, $900 other debts, and $650 escrow, the sample shock scenario reaches about 48.2% DTI, signaling elevated risk.
If the shock DTI exceeds your target, you can respond in three practical ways: increase down payment, reduce the purchase price, or lower total debts. The “max loan supported” outputs estimate how much principal your target payment can carry at each rate. Comparing supported home price at current versus shock helps you negotiate with a risk-adjusted ceiling before committing to an offer. Pair this with cash-reserve planning so you can absorb repairs, temporary income drops, and higher-than-expected escrow adjustments over time.
Rate shock is the payment jump that happens when interest rates rise, especially during budgeting or before locking a rate for a loan.
Many borrowers plan around 36% total DTI, while some lenders allow higher. Use a lower target if your income is variable or savings are limited.
Yes. Those costs affect your real monthly housing expense. Leaving them out can underestimate DTI and make shock risk look smaller than it is.
Set the shock rate to a plausible adjusted rate based on caps and market conditions. This tool helps you see if the future payment still fits your budget.
Not directly. If you expect mortgage insurance, add it to “Taxes & insurance (monthly)” so it is counted in housing costs and DTI.
A common approach is 1–3 percentage points above your baseline rate. You can also test multiple shocks to see where affordability breaks.
Important Note: All the Calculators listed in this site are for educational purpose only and we do not guarentee the accuracy of results. Please do consult with other sources as well.