Mortgage Prequalification Calculator
Estimate the maximum home loan you can prequalify for based on gross income, monthly debts, credit score, down payment, and loan type (conventional, FHA, VA, USDA). Uses 2026 lender DTI rules and current 30-year mortgage rates. All calculations run locally in your browser.
What Is a Mortgage Prequalification?
A mortgage prequalification is a lender's preliminary estimate of how much home loan you may qualify for, based on self-reported income, debts, credit, and down payment. Unlike a preapproval (which involves verified documentation and a credit pull), a prequalification is a 5-minute calculation you can run yourself before talking to a lender. The Consumer Financial Protection Bureau recommends running your own prequalification first so you walk into lender conversations with realistic price expectations. Per CFPB home-buying guidance, your maximum prequalification depends on three lender ratios: front-end DTI (housing payment ÷ gross income), back-end DTI (all debts ÷ gross income), and loan-to-value (loan ÷ home price). The 2026 conventional lender ceilings are 28% front-end, 43% back-end (or 50% with strong compensating factors per Fannie Mae's 2024 update). FHA allows up to 31%/43%, and VA loans use a residual income test instead of DTI. Last updated May 2026.
The 28/36 Rule and Why Lenders Use It
The classic underwriting guideline, sometimes called the 28/36 rule, says no more than 28% of gross monthly income should go to housing (PITI: principal, interest, taxes, insurance) and no more than 36% to total recurring debt. Modern automated underwriting systems (Fannie Mae's Desktop Underwriter, Freddie Mac's Loan Product Advisor) push back-end DTI to 45-50% with compensating factors like 20%+ down, 760+ FICO, or 6+ months of cash reserves. This calculator applies a back-end DTI cap based on your selected loan type: 43% conventional, 43% FHA, 41% VA suggested (no hard cap), 41% USDA. To stretch your prequalification, the highest-ROI moves are paying down credit-card balances (every $100 in monthly minimum payment frees roughly $20,000-$25,000 of home price at today's rates) and increasing your down payment to avoid PMI. Per Fannie Mae eligibility policy, the 50% DTI cap requires at least one strong compensating factor.
Prequalification vs Preapproval — Don't Confuse Them
A prequalification is a soft estimate; a preapproval is a verified commitment. Sellers in competitive 2026 markets routinely require a preapproval letter (with credit pull, W-2/tax verification, and asset documentation) before considering an offer — a prequalification rarely carries weight. The right sequence is: (1) run this prequalification yourself to set a realistic budget, (2) shop 3-5 lenders for rate quotes, (3) get a formal preapproval from your top 1-2 choices once you're ready to actively look. Preapproval letters typically expire in 60-90 days and require a fresh credit pull if extended. Multiple credit pulls within a 14-45 day window count as a single inquiry for FICO scoring purposes (the "rate-shopping window"), so don't space out your applications. Source: myFICO inquiry guidance.
How Your Credit Score Affects Prequalification
Credit score impacts both the rate offered and the maximum DTI ratio allowed. As of 2026, conventional lenders tier rates roughly: 760+ gets the best rate (par), 740-759 adds about +0.125%, 700-739 adds +0.25-0.375%, 660-699 adds +0.5-0.875%, and below 660 may require FHA or specialty lender. A 100-point FICO swing from 660 to 760 can lower your monthly payment on a $400,000 loan by roughly $200 — equivalent to about $30,000 of additional home-buying power at today's rates. Before applying, pull your free FICO from annualcreditreport.com, dispute any errors, and pay credit cards down to under 30% utilization (under 10% is even better). Avoid opening new credit, closing old accounts, or making large unexplained deposits in the 90 days before applying — all three can knock 10-30 points off your score and shrink your prequalification.