Use this calculator to see the home you can afford if you make $870,000 in a year
For Interest Rate: 6%
Loan Term: 30 years
You will receive loan of $2,297,554.49
Okay, so let's imagine you make $870,000 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 $165,300 a year, or $13,775 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 ($72,500), you can only spend up to $23,200 on monthly mortgage. At 6% interest rate and 20 year loan term, you can take the home loan of value $3.2M (without down payment)
If you extend the loan term to 25 years.
With monthly income of $72,500. With 6% interest, you will receive a loan of $3.6M (without down payment).
Your monthly interest payment remains the same $23,200
You will make total 300 installments
You will have to pay total amount of $6,960,000, which is 93.29% more than your original loan amount ($3,600,799.24)
For 6% interest, you will receive a loan of $3.9M (without down payment) for loan term of 30 years
Your monthly interest payment remains the same $23,200
You will make total 360 installments
You will have to pay total amount of $8,352,000, which is 115.84% more than your original loan amount ($3,869,565.45)
The longer the loan duration, the more money you will pay collectively
| Monthly Payment | Loan Years | Interest Rate | Home Loan Amount |
|---|---|---|---|
| $23,200 | 20 | 1% | $5,044,637.35 |
| $23,200 | 20 | 2% | $4,586,037.61 |
| $23,200 | 20 | 3% | $4,183,213.21 |
| $23,200 | 20 | 4% | $3,828,507.11 |
| $23,200 | 20 | 5% | $3,515,387.26 |
| $23,200 | 20 | 6% | $3,238,273.9 |
| $23,200 | 20 | 7% | $2,992,394.15 |
| $23,200 | 20 | 8% | $2,773,659.57 |
| Monthly Payment | Loan Years | Interest Rate | Home Loan Amount |
|---|---|---|---|
| $23,200 | 25 | 1% | $6,155,928.81 |
| $23,200 | 25 | 2% | $5,473,578.51 |
| $23,200 | 25 | 3% | $4,892,333.72 |
| $23,200 | 25 | 4% | $4,395,297.61 |
| $23,200 | 25 | 5% | $3,968,593.09 |
| $23,200 | 25 | 6% | $3,600,799.24 |
| $23,200 | 25 | 7% | $3,282,496.16 |
| $23,200 | 25 | 8% | $3,005,896.92 |
| Monthly Payment | Loan Years | Interest Rate | Home Loan Amount |
|---|---|---|---|
| $23,200 | 30 | 1% | $7,213,043.96 |
| $23,200 | 30 | 2% | $6,276,725.58 |
| $23,200 | 30 | 3% | $5,502,793.65 |
| $23,200 | 30 | 4% | $4,859,500.78 |
| $23,200 | 30 | 5% | $4,321,733.52 |
| $23,200 | 30 | 6% | $3,869,565.45 |
| $23,200 | 30 | 7% | $3,487,135.58 |
| $23,200 | 30 | 8% | $3,161,777.06 |