Mortgage Affordability Calculator

Home affordability is calculated using several key factors:

• Gross Monthly Income: Your total monthly earnings before taxes
• Monthly Debts: Car payments, credit cards, student loans, etc.
• Down Payment: How much cash you have for a down payment
• Current Interest Rates: Today's mortgage rates in Nevada
• DTI Ratio: Lenders typically require debt-to-income ratio under 43-50%

This calculator uses industry-standard formulas to determine the maximum home price you can qualify for based on these factors, adjusted for Nevada's property tax rates and typical insurance costs.

The 28/36 rule is a traditional guideline that suggests:

• 28% Rule: Your housing payment (PITI) should not exceed 28% of your gross monthly income
• 36% Rule: Your total monthly debt payments should not exceed 36% of your gross monthly income

Example: If you earn $7,000/month gross income:

• Maximum housing payment: $1,960 (28% of $7,000)
• Maximum total debt: $2,520 (36% of $7,000)

Note: VA loans often allow higher DTI ratios (up to 41-50%) with strong compensating factors like excellent credit, cash reserves, or stable employment history.

To afford a $400,000 home in Las Vegas with a VA loan (0% down), you typically need:

Minimum Income Required:

• With zero other debts: ~$7,000/month ($84,000/year)
• With $500/month in other debts: ~$8,000/month ($96,000/year)

Use our affordability calculator to see exactly how much home you can afford based on your specific income and debt situation.

While lenders may approve you for a certain amount, it's wise to consider these factors before maxing out your budget:

• Emergency Savings: Maintain 3-6 months of expenses after closing
• Home Maintenance: Budget 1-2% of home value annually for repairs
• HOA Fees: Many Nevada homes have $50-$300/month HOA dues
• Utility Costs: Las Vegas summers mean higher AC bills ($200-$400/month)
• Lifestyle Flexibility: Leave room for vacations, dining out, and savings goals

Rule of Thumb: Many financial advisors recommend staying at 70-80% of your maximum approved amount to maintain financial flexibility and peace of mind.

Your down payment impacts affordability in several ways:

• Larger Budget: With a bigger down payment, you can afford a more expensive home while keeping monthly payments manageable
• Lower Monthly Payment: Less borrowed = lower principal and interest payment
• Reduced VA Funding Fee: 10%+ down lowers funding fee from 2.15% to 1.25%
• Competitive Advantage: In hot Nevada markets, a down payment can make your offer stronger

VA Loan Advantage: Unlike conventional loans, VA loans require 0% down, meaning you can buy now and build equity immediately without waiting years to save 20% down payment.

Credit score requirements for Nevada home loans vary by loan type:

• VA Loans: 580-620 minimum (no VA minimum, but lenders set overlays)
• FHA Loans: 580+ for 3.5% down, 500-579 for 10% down
• Conventional Loans: 620+ typically, 680+ for best rates

Higher credit scores (700+) unlock lower interest rates, which significantly increases your buying power. A 1% rate difference on a $400,000 loan can change your monthly payment by $200-$250.