How Much House Can I Afford in Morris, Sussex & Warren County, NJ?
Enter your annual income, down payment, and monthly debts to see the home price that fits your budget. Then open Advanced and add the property tax rate for the town you're considering. In New Jersey, taxes can change your buying power by a lot, so don't skip that step.
Addison Real Estate is a locally owned brokerage in Mount Arlington, founded in 2019 by broker/owner Kellene Addison. Our agents live and work in the towns they sell, from Lake Hopatcong to Sparta, Randolph, Newton, and Hackettstown.
Quite affordable.
Getting a realistic number for a New Jersey home
Add property taxes before you trust the result.
Use the tax rate for your town. The calculator starts with a sample property tax rate. New Jersey property taxes are among the highest in the country and vary from town to town, even between neighbors. Look up the annual taxes on a few listings in the town you’re considering (or ask us), and replace the sample rate in Advanced. Comparing towns can change what you can afford as much as comparing homes.
Check the interest rate.
Replace the pre-filled rate with a current quote from a lender. A small change in rate moves your price range more than most people expect.
Under 20% down? Leave room for PMI.
Conventional loans with less than 20 percent down usually carry private mortgage insurance, which adds to the monthly payment. The calculator doesn't add it for you.
Lake and waterfront homes: ask about flood insurance.
If a home is in a FEMA high-risk flood zone and you're using a federally backed mortgage, your lender will require flood insurance. Add the quote to the Home Insurance field.
Next steps:
Your down payment isn't all the cash you need. Closing costs are a separate, one-time expense. Your lender's Loan Estimate shows what to expect.
Work out the monthly payment on a specific home with our Mortgage Calculator.
A calculator gives an estimate; a lender pre-approval gives you a real number sellers take seriously. Get approved.
New to buying? Read How to Buy a Home in NJ.
Questions about a town or a home?
Call (862) 251-4915 to speak with a local agent at Addison Real Estate
Affordability Help
Annual Income
This is the combined annual income for you and your co-borrower. Include all income before taxes, including base salary, commissions, bonuses, overtime, tips, rental income, investment income, alimony, child support, etc.
Down Payment
The typical rule of thumb is to pay 20 percent of the home's price as your down payment, although some mortgage loans require as little as 3.5 percent down. Your down payment reduces the total amount of your mortgage loan, so the more money you put down, the lower your payments will be - or the more expensive a house you can buy.
Other Monthly Debts
Include all monthly debt payments for of you and your co-borrower, including: minimum monthly required credit card payments, car payments, student loan payments, alimony/child support payments, any house payments (rent or mortgage) other than the new mortgage you are seeking, rental property maintenance, and other personal loans with periodic payments.
Do NOT include: credit card balances you pay off in full each month, existing house payments (rent or mortgage) that will become obsolete as a result of the new mortgage you're seeking, or the new mortgage you're seeking.
Loan Term
Your loan program can affect your interest rate and monthly payments. Choose from 30-year fixed, 15-year fixed, and more in the calculator.
Loan Type
There are several types of mortgage loans, but the most commonly used are fixed-rate and adjustable-rate loans. Fixed-rate loans have the same interest rate for the entire duration of the loan. That means your monthly payment will be the same, even for long-term loans, such as 30-year fixed-rate mortgages. Two benefits to this loan type are stability, and being able to calculate your total interest up front. Adjustable-rate mortgages (ARMs) have interest rates that can change over time. Typically they start out at a lower interest rate than a fixed-rate loan, and hold that rate for a set number of years, before changing interest rates from year to year. For example, if you have a 5/1 ARM, you will have the same interest rate for the first 5 years, and then your interest rate will change from year to year. The main benefit of an adjustable-rate loan is starting off with a lower interest rate.
Interest Rate
This field is pre-filled with the current average mortgage rate. Your actual rate will vary based on factors like credit score and down payment.
Property Tax
The mortgage payment calculator includes estimated property taxes based on the home's value. You can edit this in the advanced options.
Home Insurance
Home insurance or homeowners insurance is typically required by lenders, depending on the loan program. You can edit this number in the mortgage calculator advanced options.
HOA Fees
A homeowners association fee (HOA fee) is an amount of money that must be paid monthly by owners of certain types of residential properties, and HOAs collect these fees to assist with maintaining and improving properties in the association.
Debt-to-Income (DTI)
Your DTI is expressed as a percentage and is your total "minimum" monthly debt divided by your gross monthly income. The conventional limit for DTI is 36% of your monthly income, but this could be as high as 41% for FHA loans. A DTI of 20% or below is considered excellent.
Home Affordability FAQ for Northwest New Jersey
Why does the calculator say I can afford more than my lender does?
Usually because property taxes, insurance, PMI, or HOA fees weren't included, or the interest rate is lower than your actual quote. Lenders also look at your credit and the loan program. Add taxes and a current rate in the Advanced options for a closer estimate, and treat a lender pre-approval as the real number.
How do property taxes affect how much house I can afford in New Jersey?
What debt-to-income ratio do I need to buy a home?
Should I get pre-approved before I start looking at homes?