Use this calculator to see the home you can afford if you make $480,000 in a year
For Interest Rate: 6%
Loan Term: 30 years
You will receive loan of $1,267,616.27
Okay, so let's imagine you make $480,000 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 $91,200 a year, or $7,600 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 ($40,000), you can only spend up to $12,800 on monthly mortgage. At 6% interest rate and 20 year loan term, you can take the home loan of value $1.8M (without down payment)
If you extend the loan term to 25 years.
With monthly income of $40,000. With 6% interest, you will receive a loan of $2.0M (without down payment).
Your monthly interest payment remains the same $12,800
You will make total 300 installments
You will have to pay total amount of $3,840,000, which is 93.29% more than your original loan amount ($1,986,647.86)
For 6% interest, you will receive a loan of $2.1M (without down payment) for loan term of 30 years
Your monthly interest payment remains the same $12,800
You will make total 360 installments
You will have to pay total amount of $4,608,000, which is 115.84% more than your original loan amount ($2,134,932.66)
The longer the loan duration, the more money you will pay collectively
| Monthly Payment | Loan Years | Interest Rate | Home Loan Amount |
|---|---|---|---|
| $12,800 | 20 | 1% | $2,783,248.2 |
| $12,800 | 20 | 2% | $2,530,227.65 |
| $12,800 | 20 | 3% | $2,307,979.7 |
| $12,800 | 20 | 4% | $2,112,279.79 |
| $12,800 | 20 | 5% | $1,939,524.01 |
| $12,800 | 20 | 6% | $1,786,633.88 |
| $12,800 | 20 | 7% | $1,650,976.08 |
| $12,800 | 20 | 8% | $1,530,294.93 |
| Monthly Payment | Loan Years | Interest Rate | Home Loan Amount |
|---|---|---|---|
| $12,800 | 25 | 1% | $3,396,374.52 |
| $12,800 | 25 | 2% | $3,019,905.39 |
| $12,800 | 25 | 3% | $2,699,218.6 |
| $12,800 | 25 | 4% | $2,424,991.78 |
| $12,800 | 25 | 5% | $2,189,568.6 |
| $12,800 | 25 | 6% | $1,986,647.86 |
| $12,800 | 25 | 7% | $1,811,032.36 |
| $12,800 | 25 | 8% | $1,658,425.89 |
| Monthly Payment | Loan Years | Interest Rate | Home Loan Amount |
|---|---|---|---|
| $12,800 | 30 | 1% | $3,979,610.46 |
| $12,800 | 30 | 2% | $3,463,021.01 |
| $12,800 | 30 | 3% | $3,036,024.08 |
| $12,800 | 30 | 4% | $2,681,103.88 |
| $12,800 | 30 | 5% | $2,384,404.7 |
| $12,800 | 30 | 6% | $2,134,932.66 |
| $12,800 | 30 | 7% | $1,923,936.87 |
| $12,800 | 30 | 8% | $1,744,428.72 |