Deciding how much house you can afford is a personal decision.  Many factors come into play.  How much can I borrow?  How much can I put toward my down payment?  What size monthly payment can I afford?   

There are no black and white answers to these questions.  Its a matter of give and take.  If you plan on a 30 year mortgage, you can probably make a lower down payment and still manage the monthly payments.  If, on the other hand, you plan on a 15 year mortgage, you'll probably want to make a larger down payment to keep your monthly payments in line with what you can afford. 

1) How large a down payment can I make?

Many buyers look at their cash on hand as their only source for their down payment.  This simply is not the case.  One way to fund or partially fund a down payment is by using a gift.   Parents, grandparents and other family members are often eager to help by making a cash gift toward the purchase of your home. 

There are also down payment assistance charities that can help you.  And, of course, if you are selling a home, the equity you've built up can be applied to your down payment.

But these are not your only options.  We can help you explore all your down payment options, including low down payment and 100% mortgage financing options that might be right for you. 

2) What size monthly payment can I afford?

When determining what size monthly payment you can afford, you'll want to consider the total housing expense, including the principal, interest, taxes and insurances, mortgage insurance, any association dues and then look at  what other monthly expenses you have.   Tangible expenses such as car payments, day care and utility bills, all play a role in how large a monthly payment you can afford. 

There are also the intangible expenses or lifestyle expenses that you'll want to consider.  Things such as dining out, travel and if you will need to buy another car soon can affect how much you may want to allocate for housing.  Will you need to adjust any of these expenses to afford a larger monthly payment to get a better home? 

How much can I borrow?

This is a question you'll want to get answered before you begin your home search.   This is something that we're here to help you with.  Our mortgage calculators will help you see how your down payment, monthly payment and the amount you borrow are all interrelated.  You can run some "what if" scenarios on your expenses.

We can answer any questions you may have about the mortgage process.  But the best way we can help is by getting you pre-qualified for a mortgage loan.  To get started, simply complete the prequalification form and let us know a good time to contact you.  We look forward to helping you buy your next home.

Or just call us toll-free now at 1-800-528-8248 and ask for a a free consultation.