How do I know how much I can afford for a house/flat?
August 27, 2007 · Print This Article
Hally asked:
Where do I start if I’m thinking about buying a first flat? How do I know how much I can afford? What does that relate to mortgage repayments? How much will i need every month to cover everything? Any good calculators online for this or any good book s for first time buyers with no idea where to start?
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Where do I start if I’m thinking about buying a first flat? How do I know how much I can afford? What does that relate to mortgage repayments? How much will i need every month to cover everything? Any good calculators online for this or any good book s for first time buyers with no idea where to start?
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Josh Dunaway has been a certfied Realtor in the suburban Chicagoland area for over 20 years. Aside from starting his own real estate company, he also owns a mortgage company as well.
Generally speaking, a third of your income should be set aside for housing.
average is 1/3 goes to housing of take home income-talk to any mortgage company and they will let you pre apply and let you know where you stand-just don’t let them talk you into more then your willing to go-i bought my house based on only 1 paycheck- i do not regret it-ask around for what average electric gas water and garbage usage in area for you monthly expenses
Successful mortgages:
1. No more than 25% of your income “debt” (debt-to-income).
2. Try to have (at least) 10% of cost as a down payment, fixed interest rate and stable employment for the past 5 years.
3. It is also helpful to show that you have banking account (savings or checking) with at least 3 months “reserve” of the assumed payment …
I use the factor for myself of 25%. It has kept out of trouble that way. a lot of people use 1/3rd. I think it is pushing it a bit. There are always unexpected expense in ones daily life.