Can I Afford This? Home and Car Affordability Calculator
Assess if you can afford major purchases like homes or cars without financial strain.
30-year terms are common for home mortgages.
Select the loan length that matches this purchase type.
- The 28% rule: housing payment under 28% of gross monthly income
- The 36% rule: total debt under 36% of gross monthly income
- Maximum DTI for most mortgages: 43%
- The 20/4/10 rule for cars: 20% down, 4-year max term, 10% of income max
- Average new car price 2026: $49,500 — average used: $28,800
Just because a lender approves you for an amount does not mean you should spend that much. Banks approve up to 43% DTI. Living at 28% is far more comfortable.
For car purchases: buy a 2-3 year old used car. New cars lose 20-30% of value in the first year. Let someone else pay for that depreciation.
Before any large purchase, calculate the total cost of ownership — not just the monthly payment. A home costs 1-2% of its value per year in maintenance alone.
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