are a number of factors that can contribute to the affordability of a house
and, as a potential homebuyer, it's important that you know what type of
mortgage payments are within your budget.
homebuyer, your first consideration will be the amount of your monthly mortgage
payments. If you owe a lot of debt,
lenders may consider you to be a high credit risk, which makes debt-to-income
ratio a leading factor in determining how much of a house you can afford.
lenders will discount any loans that you will have paid off within one year
when determining how much of a home you can afford. As a general rule, your mortgage payment
should not exceed 25-30 percent of your monthly take-home pay.
you will end up paying more interest in the long run, you will find that you
can afford a more expensive house if you request a loan term of 25-30 years,
compared to a shorter term of 15 years.
you look at an interest rate, all you see is a number. Hopefully, it's a single digit that's
comparable with current market rates.
Most homebuyers already know that their interest rate affects their
monthly payment which, in turn, is determined by the borrower's income. Lower interest rates mean that you can afford
a larger principal loan amount, which means a more expensive house.
your past credit history will play a large role in determining your interest
rates, it will also impact the affordability of a house. For instance, a buyer who pays four percent
interest will save a considerable amount of money over a buyer who pays six percent interest on their home loan. It
may not seem like much now but, when averaged over time, the savings could be
it or not, the amount of your down payment will not only show the lender how
serious you are about buying a home, but it will also affect your ability to
afford a particular house. For instance,
if you were to qualify for a home loan of $200,000, but your dream home was
currently listed for $250,000, a down payment in the amount of $50,000 would
get you into the home.
above scenario is just an example, but it does show how a down payment can
affect the price of the home that you are able to afford. Some lenders may only require a five percent
down payment, but you are free to pay as much above that as you wish. A larger down payment can also reduce the
principal loan amount, which thereby reduces the monthly mortgage payments.
Author:Darbi McGlone Phone: 225-413-6305 Dated: July 22nd 2013 Views: 821 About Darbi: As a little girl, Darbi grew up around Real Estate. Her mother had been in the Real Estate business ...
Jim Talbot Real Estate is dedicated to providing exceptional service to both buyers and sellers. We believe that EVERY customer is the most important! Built on a solid foundation of honesty, integrity and fairness, we are known and respected in the community and by our real estate peers. We are small enough to give individual customer service to our clients, yet we are large enough to make a real impact in the marketplace. We offer assistance with residential, commercial, investment, and vacant land transactions. We love to introduce newcomers to the Baton Rouge area. We love where we live, and we want you to love it here as much as we do! We can help you with learning the neighborhoods, schools, churches, grocery stores, shopping, social scene, and in general - everything you might want to know! We are committed to making your move and transition as simple as possible. Our agents are very familiar with the entire Baton Rouge area as well as surrounding areas, so if you are looking to purchase OR sell, WE ARE READY TO HELP!
One of my favorite things about living in Louisiana is the food, and w
"I highly recommend Darbi if you are looking to buy or sell a home. She was very patient showing us homes last year when we were looking. When it came time to sell my old home, she gave us a few recommendations on what to update to help it sell (nothing major). My home sold to the first couple that looked at it! What a relief not to have to keep showing it. I wouldn't hesitate to use her again but hope that we are now in our forever home :-) Thanks Darbi
Realtor: Darbi McGlone
Year Bought: 2014
Year Sold: 2014"