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How Much House Can You Afford?

How Much House Can You Afford?

Determining how much home you can afford, or what payment you feel comfortable with, can be a trying process. Calling lenders, looking at mortgage loan programs and interest rates can be confusing, to say the least. There is an easy way to get started, and give yourself an idea of where you stand.

Image: What Ever Home Buyer Should Know

The first step is to find out what mortgage interest rates are at the current time. You can typically do this with a couple of phone calls to lenders or some quick looking on the internet. Get your rates on conventional fixed rate loans. Now use this handy table to see what your payment would be at different price ranges and interest rates. Payments might be higher or lower than those shown in the chart depending on current interest rates.

To obtain a very clear picture of how much home you can actually qualify for, the best idea is to contact a reputable local lender and let them analyze your entire situation. The lender can calculate your income-to-debt ratio, do a quick credit score and give you the information you need. Typically, lenders like to see a ratio not exceeding about 28%. This does not take into consideration long term monthly debt. As an example, to qualify for a loan, lenders may require ratios of 28% or 36%. This means you can spend up to 28% of your gross monthly income on a motgage payment, and no more than 36% of your gross monthly income on all forms of debt, mortgage included.

We work with a number of loan officers and would be happy to recommend one right for you. Click here to contact us today. We are happy to help!

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Contact Information

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Leticia & Associates
Keller Williams Vision
15325 Fairfield Ranch Rd Ste 100
Chino Hills CA 91709-8834
(909) 731-8187
(909) 731-8187 cell/text

We can assist buyers, sellers, investors, first time home buyers, relocations, and is a certified short sale specialist in todays real estate market. We provide real estate services in Chino Chino Hills and the surrounding communities of Corona, Diamond Bar, Fontana, Ontario, Rancho Cucamonga, and Upland, Yorba Linda, Brea, La Habra. 

This website created and maintained by
Kim Hughes - Real Estate Virtual Assistant

CA BRE No. 01885348