How much home can I afford?
There are many questions to be asked concerning the home-buying process, but none more important than the one above. Buying a new home is truly a rewarding experience, but buying too much home can lead to serious problems in the future.
While there are varying thoughts on how much home your budget can afford, a common rule of thumb is that your monthly housing expenses should not total more than 33% of your gross (before taxes) income.
That includes your mortgage payment, property taxes, and home owners insurance. So take a third of your current income and use that as the maximum amount that you'll be able to afford.
How much will my monthly payment be if I buy that house?
That's the next most frequently asked question by a prospective home buyer. For the answer to that important question, we'll need to use the mortgage calculator below.
Enter the price of the house, the intended length of the mortgage, the current interest rate.
Once you've entered that information, click the "Calculate" button and we'll estimate the monthly payments for you. Remember, you'll still need to add insurance and taxes to the calculated amount to determine your complete monthly payment. (Give me a call or email me and I'll determine your approximate taxes and insurance.)
Sep 5, 2008