Home Trade-Up Calculator

How the math works

Five-step calculation:

1. Net sale proceeds = current home value − agent commission (~6%) − closing costs (~1-2%) − remaining mortgage balance.
2. Available cash for down payment = net sale proceeds + savings on hand − moving costs ($3-10K) − closing costs on new home (~3% of purchase).
3. Maximum new home price = available cash ÷ down payment % (typically 20%, sometimes 10-15% with PMI).
4. New monthly payment check at 2026 mortgage rates (6-7%) — must fit your debt-to-income ratio.
5. Affordability ceiling = lower of (max from cash) and (max from monthly payment).

The trap: people who locked a 3% mortgage in 2020-2021 face very different math at 2026's 6.5% rates. Trading up to a "similar-sized house" often means a much higher monthly payment because the new mortgage is at the new rate.

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Real-world scenarios

• 3% mortgage → 6.5% trade-up: the rate-lock-in problem — why your "free" trade-up is really paid for in monthly payment increases.