How do I know if I qualify for a mortgage?

Lenders evaluate four primary factors: credit score (minimum 620 for conventional, 580 for FHA), debt-to-income ratio (back-end DTI ideally under 43%), down payment (3-3.5% minimum), and income stability (2 years of consistent employment or self-employment). Enter your numbers into this calculator to get an instant QUALIFIED or NOT YET result with specific reasons.

What credit score do I need to buy a house?

Minimum credit scores by program: Conventional (Fannie/Freddie) = 620, FHA = 580 (3.5% down) or 500 (10% down), VA = 620 (lender overlays vary), USDA = 640, Jumbo = 700-720. However, a higher score saves money: going from 680 to 760 can save 0.5-1.0% on your rate, which equals thousands annually on a large loan.

What is the maximum DTI for a mortgage?

DTI limits by program: Conventional = 43-45% back-end (higher with strong compensating factors), FHA = 50% with strong credit/reserves, VA = 41% guideline (but exceptions with residual income), USDA = 41% total. Your back-end DTI includes all monthly debt payments plus the new PITI (principal, interest, taxes, insurance) divided by gross monthly income.

How much income do I need to buy a $400,000 house?

With a 10% down payment ($40,000) and a $360,000 loan at 6.75%, estimated payment is about $2,334/month for P&I, plus taxes and insurance of roughly $600/month, totaling ~$2,934. At a 36% DTI, you need $8,150/month income ($97,800/year). At 43% DTI, $6,825/month ($81,900/year). Your existing monthly debts reduce these maximums — every $100 in debts reduces your qualifying loan by roughly $15,000.

What is the quickest way to improve mortgage qualification?

The fastest improvements: (1) Pay credit card balances to under 30% utilization — can boost score 20-40 points in 30 days. (2) Pay off small installment loans to reduce monthly debt count. (3) Add a co-borrower with income. (4) Use down payment assistance programs to increase down payment without saving. (5) Switch to FHA if credit score is 580-640. Most lenders allow one retry 30-60 days after credit changes.

Mortgage Qualifier Calculator

Get a clear QUALIFIED or NOT YET answer with specific reasons, your maximum loan amount, and the exact steps to qualify if you are not there yet.

Annual Household Income

Monthly Debt Payments

Credit Score (FICO)

Down Payment

Target Purchase Price

✓

LIKELY QUALIFIED

For $350,000 at 6.750% — Conventional

Estimated Rate (Score-Based)

6.750%

Est. Monthly Payment (P&I)

$2,011

Back-End DTI

41.0%

Max Loan (at 43% DTI)

$376,774

Max Price (at 43% DTI)

$416,774

Qualified Programs

Conventional, FHA, FHA (10% down min), Non-QM

Advanced

What Is Holding You Back & Quick Wins

Specific qualification blockers with dollar amounts, improvement timeline, quick wins to qualify immediately

Specific items that affect your qualification for $350,000, ranked by severity:

NOTE: Down payment below 20% — PMI required (~$129/mo)

Fix: Need $30,000 more for 20% — Estimated time: 43 months

Pro

Price Point Table, Co-Borrower Boost & Alternative Paths

Qualify/fail at every price point, co-borrower income boost, conventional vs FHA/VA/USDA/non-QM

Pass/fail at each price point with your current income ($85,000), debts ($500/mo), and down payment ($40,000).

Price	Loan Amount	Down %	Payment (P&I)	Back-End DTI	Qualified?
$200,000	$160,000	20.0%	$1,038	24.9%	PASS
$250,000	$210,000	16.0%	$1,362	30.3%	PASS
$300,000	$260,000	13.3%	$1,686	35.6%	PASS
$350,000	$310,000	11.4%	$2,011	41.0%	PASS
$400,000	$360,000	10.0%	$2,335	46.4%	PASS
$450,000	$410,000	8.9%	$2,659	51.7%	PASS
$500,000	$460,000	8.0%	$2,984	57.1%	FAIL
$550,000	$510,000	7.3%	$3,308	62.5%	FAIL
$600,000	$560,000	6.7%	$3,632	67.9%	FAIL

Estimated rate based on credit score. DTI limits: 43% conventional, 50% FHA, 41% VA/USDA. PMI not included in payment shown. Taxes and insurance estimated at 1.0% and 0.35% of value annually.

How to Use This Mortgage Qualifier Calculator

Five inputs are all you need for an instant qualification assessment:

Annual Household Income: All gross income (before taxes) from all sources you plan to use to qualify: W-2 wages, self-employment income (2-year average), Social Security, pension, rental income. If applying with a co-borrower, include both incomes.
Monthly Debt Payments: All existing recurring debt minimum payments: car loans, student loans, credit card minimums, personal loans, and any other installment or revolving debt. Do NOT include rent, utilities, subscriptions, or the new mortgage payment.
Credit Score: Use your middle FICO score — the median of your three bureau scores. If applying with a co-borrower, lenders use the lower borrower's middle score.
Down Payment: Cash available for down payment. This does not include closing costs — budget 2-4% of purchase price separately for closing costs.
Target Purchase Price: The price of the home you want to buy. Try different amounts to find your maximum qualification point.

The Quick Calculator gives you a pass/fail verdict with your estimated rate, payment, and DTI. Use Advanced to see specific blockers and the timeline to fix each one. Pro shows a full price point table and program comparison.

How Mortgage Qualification Is Assessed

Front-End DTI = (PITI) ÷ Gross Monthly Income
Back-End DTI = (PITI + All Monthly Debts) ÷ Gross Monthly Income
Max Loan (43% DTI) = [(Income × 0.43) − Monthly Debts] ÷ Monthly Payment Factor
PITI = Principal + Interest + Property Tax + Insurance (+ PMI if applicable)

The back-end DTI is the most critical number. Conventional loans allow up to 43-45%, FHA up to 50%, and VA up to 41% with exceptions. The higher your existing monthly debts, the lower the mortgage payment you can qualify for — and therefore the less home you can buy.

The Four Pillars of Mortgage Qualification

Credit (Character): Your FICO score signals how reliably you repay debts. Scores above 740 get the best rates; below 620 limits you to FHA or non-conventional programs.

Capacity (Income and DTI): Can you afford the payment? Lenders verify income with 2 years of tax returns (self-employed), W-2s, and recent pay stubs. Your DTI must fall within program limits.

Capital (Down Payment and Reserves): More down payment = less risk to the lender. 20% eliminates PMI. Most programs require 2 months of reserves (savings) after closing.

Collateral (Property Value): The home must appraise at or above purchase price. Lenders lend against the lower of purchase price or appraised value.

Example: From NOT YET to Qualified in 90 Days

James, targeting a $380,000 home in Atlanta, GA

Annual Income	$78,000
Monthly Debts	$780 (car + student loan)
Credit Score (initial)	648
Down Payment	$14,000 (3.7%)
Initial Result	NOT YET — DTI 54% exceeds FHA 50% limit

90-day action plan:

Action 1: Pay credit card to 28% utilization	Credit score: 648 → 681 (Month 1)
Action 2: Pay off $4,800 personal loan (eliminates $200/mo debt)	DTI: 54% → 50.4% (Month 2)
Action 3: Add $5,000 gift funds from parents	Down payment: $14,000 → $19,000 (5%)
Final Result at Month 3	QUALIFIED — FHA at 7.125% (score 681)
Monthly Payment (P&I)	$2,426 on $361,000 loan

James did not need to wait a year. By paying down credit utilization, eliminating one debt payment, and adding gift funds, he went from NOT YET to an FHA approval in 90 days. The key lesson: targeted action on specific blockers is faster than generic "improve your finances" advice.

Frequently Asked Questions

No. This calculator gives you an informed estimate based on standard underwriting guidelines. Actual approval depends on additional factors: employment history (2+ years), source of down payment funds, property type, appraisal value, lender overlays (stricter internal requirements), and debt documentation details. The only way to know for certain is a full pre-approval from a lender who pulls your credit and reviews your documents.

This calculator is a self-service tool using your self-reported numbers to give you an instant sense of where you stand. It does not pull your credit or verify your income. Mortgage prequalification involves a lender reviewing your stated information (no credit pull for "soft" prequalification). Mortgage pre-approval is formal — it includes a hard credit pull and income/asset verification — and is the document sellers accept as proof of financing. Use this tool to prepare, then get pre-approved with a lender.

Possibly, with compensating factors. Conventional loans (Fannie/Freddie Desktop Underwriter) allow DTI up to 50% with strong compensating factors such as: credit score above 720, significant cash reserves (12+ months of payments), large down payment (20%+), or a history of managing similar housing expenses. FHA allows up to 50% DTI as a hard cap. A 46% DTI with 720+ credit and 10%+ down payment has a reasonable chance of approval even through automated underwriting.

The calculator applies, but self-employed income calculation is more complex. Lenders use your 2-year average net income from tax returns (Schedule C or K-1) — not gross revenue. If you have written off significant business expenses, your qualifying income may be lower than expected. Some lenders offer bank statement loans that use 12-24 months of deposits (typically 50% or 25% is counted as income) instead of tax returns, at slightly higher rates.

The fastest credit improvement strategy: pay credit card balances to under 30% utilization (report date = 30 days, often takes 1-2 billing cycles). This alone can raise scores 20-50 points within 60 days. Removing errors from your credit report can boost scores in 30-45 days once the dispute is resolved. Adding a co-signer or authorized user to a well-managed account can help immediately. Most people can move from 640 to 680 in 2-4 months with focused action. Getting from 620 to 760 typically takes 12-24 months of consistent credit behavior.