Use this calculator to see the home you can afford if you make $420,000 in a year
For Interest Rate: 6%
Loan Term: 30 years
You will receive loan of $1,109,164.24
Okay, so let's imagine you make $420,000 a year. That's a lot of money! Now, let's figure out how much of that you can spend on a house.
A person called a mortgage broker can help you decide. They might say you can spend 19% of your yearly income on your mortgage. That means you can spend $79,800 a year, or $6,650 each month on your mortgage.
According to Canada Mortgage and Housing Corporation ,upto 32%(preferred) of gross monthly household income can be spent on P.I.T.H (Principal, Interest, Taxes and Heating Solutions) The maximum limit is 39%.
So, according to your monthly income ($35,000), you can only spend up to $11,200 on monthly mortgage. At 6% interest rate and 20 year loan term, you can take the home loan of value $1.6M (without down payment)
If you extend the loan term to 25 years.
With monthly income of $35,000. With 6% interest, you will receive a loan of $1.7M (without down payment).
Your monthly interest payment remains the same $11,200
You will make total 300 installments
You will have to pay total amount of $3,360,000, which is 93.29% more than your original loan amount ($1,738,316.88)
For 6% interest, you will receive a loan of $1.9M (without down payment) for loan term of 30 years
Your monthly interest payment remains the same $11,200
You will make total 360 installments
You will have to pay total amount of $4,032,000, which is 115.84% more than your original loan amount ($1,868,066.08)
The longer the loan duration, the more money you will pay collectively
| Monthly Payment | Loan Years | Interest Rate | Home Loan Amount |
|---|---|---|---|
| $11,200 | 20 | 1% | $2,435,342.17 |
| $11,200 | 20 | 2% | $2,213,949.19 |
| $11,200 | 20 | 3% | $2,019,482.24 |
| $11,200 | 20 | 4% | $1,848,244.81 |
| $11,200 | 20 | 5% | $1,697,083.51 |
| $11,200 | 20 | 6% | $1,563,304.64 |
| $11,200 | 20 | 7% | $1,444,604.07 |
| $11,200 | 20 | 8% | $1,339,008.07 |
| Monthly Payment | Loan Years | Interest Rate | Home Loan Amount |
|---|---|---|---|
| $11,200 | 25 | 1% | $2,971,827.7 |
| $11,200 | 25 | 2% | $2,642,417.21 |
| $11,200 | 25 | 3% | $2,361,816.28 |
| $11,200 | 25 | 4% | $2,121,867.81 |
| $11,200 | 25 | 5% | $1,915,872.53 |
| $11,200 | 25 | 6% | $1,738,316.88 |
| $11,200 | 25 | 7% | $1,584,653.32 |
| $11,200 | 25 | 8% | $1,451,122.65 |
| Monthly Payment | Loan Years | Interest Rate | Home Loan Amount |
|---|---|---|---|
| $11,200 | 30 | 1% | $3,482,159.15 |
| $11,200 | 30 | 2% | $3,030,143.38 |
| $11,200 | 30 | 3% | $2,656,521.07 |
| $11,200 | 30 | 4% | $2,345,965.89 |
| $11,200 | 30 | 5% | $2,086,354.11 |
| $11,200 | 30 | 6% | $1,868,066.08 |
| $11,200 | 30 | 7% | $1,683,444.76 |
| $11,200 | 30 | 8% | $1,526,375.13 |