How Much Home Can I Afford?

Of course, they have good reasons. Put yourself in the bank's shoes: If you were going to lend people money, what would you want to know about them? Basically, you'd like to know 1) if they make enough money to pay you back, 2) if they've been trustworthy in the past, and 3) if they have something of value should they be unable to pay you back. Hence, what you can afford depends on your income, credit rating, and down payment (so the bank has equity in the property). 

The first step in finding a home is figuring out how much home you can afford. From my experience, most people have a good idea how much they can comfortably pay every month toward their home. However, they don't know how much home that payment can purchase. There aren't many mortgage calculators available that quickly account for the Principle, Interest, Taxes and Insurance (PITI) which makes up the total payment. Additionally, if you're purchasing a condominium you must add the Home Owners Association (HOA) fee, and if you're currently renting you should account for the tremendous tax deductions the government gives to home owners.

Our website offers a variety of Mortgage Calulators which you can typically find on the internet. They will give you the principle and interest payments, and compare different types of interest rates. Please use them for your basic calculations.