How Much House Can You Afford?
This is what you can afford in San Antonio, TX
$387,707
Your debt-to-income ratio (DTI) would be 36%, meaning 36% of your pretax income would go toward mortgage and other debts.
Get Pre-ApprovedHow Much House Can You Afford with a VA Loan?
As a Veteran, one of your greatest benefits is the ability to buy a home with a VA loan—often with no down payment, no mortgage insurance, and more flexible requirements. This guide will help you calculate how much house you can afford using your VA loan benefit in 2025.
What Does VA Loan Affordability Mean?
Affordability with a VA loan refers to the maximum home price you can comfortably buy while keeping your budget intact. VA loans make this process easier by eliminating private mortgage insurance (PMI) and allowing for $0 down, but it still depends on your income, debts, and other expenses.
Key Factors That Influence VA Loan Affordability
- Income: Your gross monthly income sets the base for what you can borrow.
- Residual Income: VA loans require a minimum amount of income left over after all expenses—this ensures you can cover basic living costs. VA residual income chart.
- Debt-to-Income Ratio (DTI): Ideally under 41%, although VA lenders may approve higher with strong residual income.
- No Down Payment Required: Most VA buyers qualify for $0 down, significantly increasing purchasing power.
- Interest Rates: Lower rates increase affordability—VA loans typically have some of the lowest rates available.
- Credit Score: Your credit score affects the interest rate you receive on a loan. The higher your score, the lower your rate will be and the more home you can afford. While the VA does not set a minimum credit score requirement for VA loans, lenders set their own requirements.
Understanding the 41% DTI Guideline and Residual Income
While conventional loans use the 28/36 rule, VA loans focus on two main criteria:
- 41% DTI Limit: Your total debt payments—including the mortgage—should ideally stay under 41% of your gross monthly income.
- VA Residual Income: After debts are paid, you must have enough monthly income remaining to support your family. This varies by region and family size. Check the VA loan requirements for all eligibility guidelines.
Example: VA Home Affordability by Income
Here’s an estimate of how much house you can afford using a VA loan based on income and $0 down payment:
| Annual Income | Monthly Income | Max Mortgage Payment (41%) | Estimated Home Price |
|---|---|---|---|
| $50,000 | $4,167 | $1,708 | $240,000 |
| $75,000 | $6,250 | $2,562 | $360,000 |
| $100,000 | $8,333 | $3,416 | $480,000 |
| $150,000 | $12,500 | $5,125 | $720,000 |
*Estimates assume a 30-year VA loan with 6% interest and no down payment.
Hidden Costs Veterans Should Consider
- VA Funding Fee: The VA funding fee one-time fee paid at closing (often rolled into the loan). Exemptions apply for those with service-connected disabilities. More from VA.gov.
- Property Taxes & Insurance: These vary widely by location and must be budgeted monthly.
- Maintenance & Repairs: Even VA buyers should plan for 1% of home value annually for upkeep.
- HOA Dues: Common in new developments and townhomes.
How to Use a VA Loan Affordability Calculator
A VA-specific affordability calculator will help estimate your maximum home price by factoring in income, debts, and whether you’re exempt from the funding fee.
Steps:
- Enter your gross monthly income and family size.
- List all monthly debts.
- Indicate your funding fee status and down payment (if any).
- Adjust for interest rate and loan term.
- Review estimated budget and confirm you meet residual income guidelines.
Tips for Veterans to Stay Within Budget
- Get Preapproved: A VA lender will confirm your eligibility and budget range.
- Ask About Funding Fee Exemptions: If you have a VA disability rating, you may avoid the fee entirely.
- Plan for Unexpected Costs: Don’t stretch your full limit—leave room for moving expenses, home repairs, and future changes.
- Work with a VA-Savvy Agent: They can help you find homes eligible for VA financing.
Benefits of Knowing Your VA Loan Budget
Veterans who understand their affordability range can:
- Search smarter and avoid wasting time on homes outside their range.
- Negotiate better by showing preapproval and financial preparedness.
- Reduce stress by planning monthly payments that match their lifestyle.
The Bottom Line
Knowing how much house you can afford is the first step toward buying with confidence. Use the calculator above to estimate your ideal price range based on your income, debts, and loan options.
Whether you’re a first-time buyer or a Veteran using a VA loan, this tool helps you set a clear budget and avoid surprises down the road.
Your results can guide conversations with lenders, narrow your home search, and keep your finances on track. Run different scenarios, explore your limits, and make smarter decisions with real numbers on your side.
Frequently Asked Questions
How do lenders determine how much house I can afford?
Lenders typically use your debt-to-income (DTI) ratio, credit score, income, and down payment amount to calculate how much house you can afford. Most aim for a DTI below 43%.
What is the 28/36 rule for home affordability?
The 28/36 rule says no more than 28% of your income should go to housing costs, and no more than 36% should go to total debt. It helps set a safe mortgage limit.
How much house can I afford if I make $70,000 a year?
With $70,000 income and good credit, you may afford a $250,000–$300,000 home, depending on your debts, down payment, and loan type. Use a calculator to get a precise estimate.
What factors affect how much house I can afford?
Your income, credit score, monthly debts, loan type, interest rate, and down payment all impact home affordability. Even property taxes and insurance affect your monthly budget.
Does my credit score impact how much I can borrow?
Yes. Higher credit scores can qualify you for lower interest rates and larger loan amounts, making it easier to afford a more expensive home with lower monthly payments.
Can I afford more house with a VA loan?
Yes. VA loans have no down payment or PMI, letting Veterans afford more home with less upfront cost. Approval still depends on income, credit, and DTI limits.
How does a down payment affect home affordability?
A larger down payment reduces your loan amount, monthly payments, and interest cost, allowing you to afford a more expensive home or lower your monthly financial burden.
Is a mortgage preapproval necessary to know how much house I can afford?
Yes. A preapproval shows exactly what a lender is willing to loan you, based on verified income, credit, and debts. It’s a key step before shopping for a home.
How do property taxes affect what I can afford?
High property taxes increase your total monthly payment, reducing the loan amount you can qualify for. Always factor in taxes when calculating affordability in your area.
How much of a monthly payment is considered affordable?
Affordable payments are usually 25%–30% of your gross monthly income. This ensures you can cover housing and other bills without becoming financially overextended.
