How much house can I afford? LITHONIA GA 30038

How much house can I afford? LITHONIA GA 30038

When you are trying to decide whether or not to purchase a home, the one main question that often comes up is how much house can I afford. The way to determine this one question will depend on how much you have for a potential down payment and how much you can borrow from the bank. Qualifying for a mortgage and then buying the house will usually require you to be prepared ahead of time. There will be issues that you will need to prepare in regards to your financial situation while you are figuring out what you can afford.


One important factor on determining how much house can you afford is your annual gross income. You will be able to get a rough estimate of your affordable home price by multiplying the annual gross income by 2.5. Another factor on determining how much house you can afford is your credit history and score. Having a not so stellar credit score or history can greatly affect your ability to qualify for a mortgage and whether or not you can get the best mortgage rate. You will want to check out your credit history and score before you decide to apply for a mortgage on a home. The next factor that may be looked at for determining how much house you can afford is the amount of your down payment. Depending on the lender and how you are getting your loan, the down payment for a house will usually need to be about 5 to 20 percent of the purchase price of the home. Also, if you are able to put 20% or more down, you will be able to avoid paying for private mortgage insurance (PMI) therefore, allowing you to reduce your mortgage payment. Since there are a wide variety of banks, lenders, and mortgage companies for you to choose from there could be a number of other factors that they will look at in determining how much house you can afford including the type of home you are purchasing, your current lifestyle, your plans for the future, current mortgage rates, and fees and closing costs. You will want to meet with a realtor, lender, mortgage company or bank to determine what the best options for you are when you are trying to decide how much house you can afford.