how much do i qualify for to buy a house

You should reduce the maximum target if you have other savings needs (such as retirement and college) or additional expenses (such as child care, private school tuition, health care, or alimony payments).
Once you enter your monthly debt (including credit cards, student loan and car payments), we come up with a maximum monthly home payment you could handle while staying under that threshold.
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Simply fill out the fields below and click calculate, the calculator will then analyze your monthly income, expenses, and future property taxes and insurance to estimate the mortgage amount that would best fit your budget.
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Also known as PMI (Private Mortgage Insurance).HOA duesTypically, owners of condos or townhomes are required to pay homeowners association dues (known as HOA fees), to cover common amenities or services within the property such as garbage collection, landscaping, snow removal, pool maintenance, and hazard insurance.Loan termThis is the length of time you choose to pay off your loan (e.g., 30 years, 20 years, 15 years, etc.)Full reportClick on the Full Report link to see a printable report that includes mortgage payment breakdowns, total payments, and a full mortgage payment amortization calculation (table and chart).
Also, remember that you’ll have additional homeownership costs that you may need to factor into your monthly budget, including insurance, association fees, and maintenance expenses.
This assumes that your total costs for your loan payments (principal and interest), taxes, and insurance should not be higher than 45% of your monthly income.
Other Annual Homeownership Expenses Other annual homeownership expenses may include annual taxes, homeowner’s insurance, homeowner’s association or condo fees, and maintenance.
Based on your income, expenses, and the loan you selected, the amount above represents the most you can comfortably afford to pay for a home*.
We may change our loan rate structure and the assumptions on which our rates are based from time to time without notice.
Based on your income, expenses, and the loan you selected, the amount above represents the most you can comfortably afford to pay for a home.
Call our helpful mortgage bankers at 1-888-866-1212 to start the conversation about how to get pre-qualified for a loan so that you can start looking for your new home.
Loan Product For Adjustable Rate products, the rate is fixed for the number of years indicated for the product selected (3, 5, 7 or 10).
The APR includes interest as well as the upfront fees and points you pay for a loan, as well as mortgage insurance (if any).
* The information above is based on the interest rate during the fixed rate period of the ARM you selected.
This assumes that your total costs for your loan payments (principal and interest), taxes, and insurance should not be higher than 45%.
The rates and estimated APRs disclosed may change before loan approval or may not be available at the time we make a loan commitment to you as an applicant, or at closing, based on market conditions.
After the fixed rate period, your payment may change based on the change in the index used to calculate your interest rate.
Annual Interest Rate The simple interest rate represents the annual cost of borrowing funds.
Make sure you’re taking all these costs into account when asking yourself, "How much home can I afford?" It’s important to be informed on all the costs involved and how much you can afford prior to committing to a home mortgage.
Sometimes closing costs can be rolled into the mortgage loan amount, which means you can pay them off as you pay down your mortgage.
Some costs associated with buying a home show up before you start making regular mortgage payments.
It can also help you compete better in the market for the house you want, make it easier to handle the up-front costs of buying a home, and make home ownership more fun and easier to manage.
Final closing costs typically range from 2% to 4% of the total loan amount.
You’ll also need to consider the up-front costs of buying a house, as well as the ongoing expenses of home ownership.
Paying mortgage points up front can also help lower your payments and interest.
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A good FICO score is key to getting a good rate on your FHA home loan.
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Use the following calculator to help you determine an affordable monthly payment so that you know what you can afford before you make an offer on the home you want to purchase.
Be smart when it comes to your FHA loan and your financial future.
FHA home loans were created to help minorities and first-time home buyers purchase a home.
When you apply for a mortgage, the lender will use all the relevant data-your income, your existing debts, the purchase price of the house, your down payment, the interest rate on the loan, and the cost of property taxes and insurance-and quickly calculate whether you qualify for the amount you need to buy the house.
You can obtain a free copy of your credit report from or for a small fee, you can request your credit profile from a credit reporting agency (look in the Yellow Pages or see our Internet resources section at the end of this chapter.). NFCC recommends that you obtain what’s known as a "tri-merge" credit score, which is a combination of all three credit reporting bureaus.
Lenders and financial advisors recommend that you spend no more than 25-28 percent of your income on housing and not more than 33-36 percent on total debt (housing, credit cards, and other debts).
The FICO score, developed by the Fair Isaac Corporation, is the most common credit score used in mortgage lending.
I grown up poor than poor and lived in a crowded rented row house with a single mom that was a linen factory worker and worked at night at Walmart…no car…public transportation.. With four daughters.. Guess what we all worked hard and now have our own single houses…and professionals plus we paid our own loans for college..I have friends that still live on the same block I grown up at making excuses..and its plain and simple…you didn’t have the drive to do better so your repeating the cycle.
With the conservative approach, you are basically playing it safe by giving a safe down payment amount and getting monthly mortgage payments that you can comfortably afford.
On the other hand if you are going for an aggressive approach, your down payment amount is usually more and will contribute greatly to the amount of interest and mortgage payments.
Besides asking your mortgage calculator how much can I afford, you also need to get a financial expert to help you answer questions– such as how much can I borrow?, what mortgage can I afford?, as well as other pertinent questions.
If you plan on buying a new car or if your child will be joining college in the next few years, how are you going to factor these expenses if your income remains the same? What if you have another child, will you still manage the mortgage? These are factors that only you can address with precision and will require you to be completely honest with yourself.
Some of the key things considered when calculating your mortgage are your income, the amount of down payment you can raise, your credit history and more.
One of the major questions that should be addressed when one needs to purchase a home is how much mortgage can I afford? This is not just a question that you should prepare to answer your loan facilitator but one that you should actually ask yourself immediately after you decide that you want to own a home.
Though the amount may be one that you can easily afford, you must think about the financial implication of the mortgage to both you and your family.
The mortgage calculator will give you information on how much you can afford to pay for a home and the mortgage amount you can qualify for.
When asking yourself how much of a mortgage can I afford? You should not only rely on what the recommendation of your lender but also the amount you feel you can personally afford.
Finally, the lender will need to get information on your credit rating so as to analyze the risk of giving you a mortgage.
This is important because you do not want to skip a mortgage payment simply because you did not factor in that your new home has larger windows and will therefore require larger curtains and similar scenarios.
Owning a home comes with sacrifices, you may need to cut back on your guilty pleasures and luxuries, it therefore helps to figure out the best ways to save money over the duration of your mortgage.
Before you can even get precise answers to the question how much mortgage can I afford? You first need to really ask yourself what it means to own a home.
With the variable rate mortgage otherwise known as a floating rate or adjustable rate mortgage, the payment is adjusted according to the interest rate.
The criteria for any loan today (2010) is as a buyer you have to qualify – enough income, limited debt and good credit.
The percentage of one’s debt to income is one of the most important factors when underwriting a loan and the two criteria to determine what you will qualify for are:.
When you have a number in hand—either from an online calculator or from your actual bank—the next thing you will want to know is what kind of house you can buy for that amount? This is a great question for your realtor to answer, and one of many reasons to work with a realtor while you are shopping for a home.
When you are ready to buy a house, the very first question you are likely to ask is: “how much home can I afford?” The answer to this question depends on a variety of factors, and you can use a home affordability calculator to get a ballpark figure and get a feel for what range of houses you should be looking at.
You can plug the relevant numbers into an online “how much house can I afford” calculator, and the calculator should give you an approximate answer for the amount of loan you should be able to take out.
It’s true that you can look up some of the realty listings online for yourself, but a realtor has the inside track on all the available properties, probably including some inside knowledge about how long various properties have been on the market, how willing the sellers might be to negotiate, and when a house is overpriced for the market.
On the same principle, if you can afford a fifteen year mortgage rather than a thirty year mortgage, your monthly payments will be higher, but your overall cost will be drastically lower because you won’t be paying nearly so much interest.
In the case of a thirty-year mortgage (depending, of course, on the interest rate) the loan’s interest can add up to three or four times the listed price of the house.
For the first ten years of a thirty year mortgage, you could be paying almost solely on the interest and hardly making a dent in the principle on your loan.
If the fifteen year mortgage puts you uncomfortably close to your maximum—meaning you won’t have any room in your budget for emergencies or extras—you could always lock into a thirty year mortgage while making a commitment to yourself to make payments the size of the fifteen-year plan unless there’s a financial emergency.
When you are wondering “how much can I afford to spend on a house,” the bottom line is what size of home loan you can qualify to borrow.
First, it’s important for you, as a home buyer, to note that you don’t have to pay a realtor any fees up front, because the realtors’ fees come from the sale of the house.
You will have an easier time making your payments, or (better yet!) you will be able to pay extra on the principle and save yourself money by paying off the loan early.
Debt ratio equals your combined monthly mortgage payment plus any other monthly debt obligations such as credit cards and alimony divided by your gross monthly income.
Housing ratio equals combined (principal + interest + taxes + insurance) monthly mortgage payment divided by your gross monthly income.
For example, a combined monthly mortgage payment of $1,200 divided by gross monthly income of $4,500 equals a housing ratio of 27%.
LearnVest Planning Services is a registered investment adviser that provides financial plans for its clients and is a subsidiary of LearnVest, Inc., which provides free articles and tools to help individuals understand general concepts of budgeting and financial planning.
LearnVest spoke with four couples from across the U.S. who are looking to purchase real estate in the near future, as well as David Blaylock, a CFP® with LearnVest Planning Services, who weighed in on how each couple can better prepare for this important next step.
With mortgage rates being very reasonable at this time, I recommend they consider a 15-year fixed mortgage for the remaining part of the purchase price instead of paying cash (while a 30-year fixed mortgage is OK, a 15-year is typically ideal).
How many people buying a home seriously wait until they have over 20% cash as a down payment? As a prospective first time home buyer, I would have appreciated them talking about other options rather than waiting until I’m in my 30′s to purchase because I should have at least a 20% down payment.
Unfortunately for homebuyers in the Dallas metro, a mortgage rate decline of only 0.12 percent (one of the smallest declines on our list) was nowhere near enough to offset the home price boost of 9.4 percent, resulting in a required salary figure that’s about $2,400 higher than the previous quarter.
The Steel City was second on our list last quarter, and even though the metro exhibited strong quarterly price growth in the second quarter, that didn’t stop Pittsburgh from becoming the most affordable area on our list.
But the hefty decline in mortgage rates wasn’t enough to counterbalance the home-price increase in the San Antonio metro during the second quarter, resulting in a required salary that was nearly $2,000 higher than it was just a quarter ago.
But falling mortgage rates weren’t enough to balance out the home-price increases in the second quarter, causing the required salary figures to increase in all but two metro areas.
Since we’ve said it here each and every time, we’ll say it again, “Here is where things start to get expensive.” For all the metro areas in which the required salary increased in the second quarter (all but two), Seattle had the smallest salary increase at $823.83 (just under Los Angeles at $836).
With home prices up over 21 percent in the second quarter, things haven’t gotten cheaper, just more affordable than some of the other metro areas on our list.
While the NAR’s home price figures never made it that high, it was still more than enough to propel the required salary in the San Francisco metro area over $50,000 higher than its closest competition–San Diego.
Just like Phoenix, Orlando saw minimal price gains during the second quarter, allowing the required salary to actually decline modestly.

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