Serving
Fayetteville, Ft. Bragg, Pope AFB & Surrounding Areas
Since 1951
Each office independently owned and operated.
2005 Homeowners LTD.©
What
Can I Afford?
Know
what you can afford is the first rule of home buying, and that depends
on you income and how much debt you have. In general, lenders don't want
borrowers to spend more than 28 percent of their gross income per month
on a mortgage payment or more than 36 percent on debts.
Check
with several lenders before you start searching for a home. They will
help you roughly calculate what you can afford and pre-qualify you for a
loan.
The
price you can afford to pay for a home will depend on six factors:
1.
gross income
2. the amount of cash you have available for the down payment, closing
costs and cash reserves required by the lender
3. your outstanding debts
4. your credit history
5. the type of mortgage you select
6. current interest rates
Another
number lenders use to evaluate how much you can afford is the housing
expense-to-income ratio. It is determined by calculating your projected
monthly housing expense, which consists of the principal and interest
payment on your new home loan, property taxes and hazard insurance (or
PITI as it is known). If you have to pay monthly homeowners association
dues and/or private mortgage insurance, this also will be added to your
PITI.
Estimate How Much You Can Afford
Sample
NC Real Estate Forms…Contracts,
addendums & more
FREE NC Consumer Real Estate Documents… Downloadable brochures, pamphlets & more
These
forms are in Adobe Portable Document Format (PDF). To view them you must
have the free Adobe Acrobat Reader installed on your computer.