How Much Home Can I afford?

 A homebuyer should typically be able to afford a home that is 3 to 3.5 times your annual salary (or income). Another general rule is your total monthly expenses (including the new home) should not be above 45% of your gross (pretax) income. For a first time home buyer, we typically recommend for this ratio to be 35% or less. You should always consult with a professional mortgage advisor (not your typical order taker at the bank). And please remember that not all banks are created equal. Some banks can be great for your day to day banking, but have a reputation as terrible mortgage lenders. Therefore, please ask either me or your friends and family for mortgage banker recommendations. A mortgage banker will advise you and let you know your qualification, how much home you can afford, what your monthly payments will be and what you should expect throughout the home buying process.  

See Step 2 Of The Home Buying Process for more information.

Below is a quick calculator for you to use. The mortgage amount is the purchase price minus down payment. Please note that most loans with less than 20% down will also have PMI (mortgage insurance) and homeowner’s insurance and property taxes bundled in their monthly payment. This calculator does not calculate those items as they depend on your pre-approval and a specific property.

Please use extreme caution when using any available mortgage calculator online. This is only intended to give you an idea of what to expect for principal and interest but does not reflect the reality. Contact me directly for an estimate built directly for you including closing costs and inclusive monthly costs.