National Real Estate Review Board
BUDGET – How Much Can I Afford?
What is my budget? As you prepare to look for homes, make sure that you know how much you can comfortably afford. You want to know how your credit and the type of mortgage you choose can affect your monthly payments and overall cost of the loan. You may qualify for a higher amount than you actually want to pay.
You may qualify for a higher amount than you actually want to pay. It’s important to not only check with a mortgage agent to get pre-approved, but to know what the payments will be at that amount. Remember to factor in homeowner’s insurance, property taxes, utility bills, moving costs & maintenance.
Determining how much “home you can afford” depends on several important factors including:
Key Ratios Lenders Use
To determine how much you can afford, it is helpful to follow the guidance and key ratios lenders use: