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Question by Greyt: How significantly “residence” Can I afford to purchase?
If I’m creating $ 990 week prior to taxes, no vehicle payment, no credit debt, quite high credit scores, I spend $ 118month for cable/internet but I’m canceling that service. Auto expenses come to $ 250 month with insurance coverage/gas. I only have about $ ten,000-12000 for a downpayment. What can I afford? I have an appointment with a bank but they can only fit me in two weeks from now. I’d like to appear at what I may be able to afford. (Go see open houses)
Very best answer:
Answer by Bob D
just a rough estimate…3 times gross salary. or about 150,000. Rough payment is about 900 a month which includes PMI.
What do you feel? Answer below!
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Bankrate.com has an online calculator that you can use to help estimate this. Click on the link to “more calculators”.
http://www.bankrate.com/gookeyword/default.asp?pop=nopop&ec_id=YSM_AG_HV_Bankrate_YSM_BRM_ky_Advanced_k_bankrate_com
This site has a lot of good information — including interest rates, you can even look at a comparison of rates in your geographic area. Shop for your mortgage, too. Don’t assume that you bank will give you the best deal. I got a much better deal from a local mortgage broker. When you’re looking at houses, and figuring out what you can afford, always keep in mind that there are a lot of costs associated with buying/owning a home that have to be added on to your mortgage payment — homeowner’s insurance, property taxes, utilities, upkeep and repair. If you don’t have enough cash to make a 20% down payment, you may also have to pay Private Mortage Insurance (PMI) in addition to principal, interest, homeowner’s insurance and property taxes. PMI can be expensive.
You can use one of the other online calculators to estimate your monthly payments of principal and interest.
Good luck.
ai yo i don’t know. i think how much you can afford to buy is to ask yourself. not ask other people to help to to solve the problems.
if your lender can’t meet with you today, FIND A NEW LENDER-no one is that busy!!!!. You said bank; find a mortgage lender, not a bank.
You make around $ 51,000 a year. Based on a 30 year 6% rate, you could get a $ 185,000 loan.
51,000/12=4290/mn
4290*.32=1,372 that you can spend for a mortgage pmt a mn
1,372-(taxes, insurance, PMI) = 1097 for the note itself
1097 a month at 6% = $ 183,000 loan
I would do a FHA loan with 3% down ($ 5,500), and get the seller to pay all your closing. Put the rest of your money in the BANK and save it. Don’t go out and buy stuff for the house. SAVE the money.
To those people that say that you should put more down, keep this in mind: for every $ 10,000 you put down, you only save $ 60 a month. I would want the $ 10,000 in the bank, vs “saving” $ 60 a month.
The rule of thumb is that the your mortgage payments and property taxes should not come to more than 30% of your gross income. How much you can afford depends on the current interest rate. There are lots of mortgage amortization tables on the net, most bank web sites have links to one. It would be good for you to play around with one for a while, just to see how different amortization periods 15, 20 30 years affect how much your payment is and how much interest you pay. Also look at different payment schedules like weekly or monthly.
A mortgage broker can be useful, I usually suggest using one, but I’m in Canada and the rules are different here. Another thing I tell people is not to accept the posted rates at the bank – those are sucker rates (but again in may be different in the US).
One thing that is true anywhere is that lenders NEED borrowers, they aren’t giving you anything so don’t go in hat in hand pleading with them. On the contrary, you are considering giving them your business. Frankly if they can’t deal with you for two weeks, I’d call another couple lenders – banks or credit unions. You don’t have to do all your dealings with the same financial institution although they favour that, for obvious reasons.
Good luck to you. House hunting can be fun. Pick a realtor who listens to you and that you feel comfortable with.
Considering the income and debts I would calculate your qualifying monthly payment at $ 1,100 a month. Your housing payment should never go over 30% of your overall gross income. Depending on what state you live in, this could buy you a very nice home.
However, any figures given are based on your ability to verify your income and your assets (2 paystubs, 2 years taxes, 2 months bnk stmts). Lenders will always look at your ability to repay, credit, collateral (house) along with your ability to save and manage your money. sounds to me like you have no debts. As for the bills you mentioned, they are considered expenses and do not count against your qualifying ratios.
Based on a 30 year fixed mortgage with a rate of 6.25% you can afford to buy a home for $ 165,000.
Good Luck.
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