When Buying a Home...First Things First - Lezamiz Real Estate Co ...

When buying a Home? First things First

Do your homework before you start the search when buying a home. The first thing you want to do is to determine the price range you will be able to afford and qualify for a mortgage.

Get your information together starting with the following list:

This is all the money coming into your household on a monthly basis. It can include salaries, spousal support payments, etc. The GROSS amount is the amount before taxes and other deductions are taken out.

This list should include all payments and generally is: current mortgage (or new mortgage payment), minimum credit card payments, car loan payments, student loan payments or any other revolving debt.

The generally accepted ratio of Debt to Income is 28% for housing payment, 36% total for housing plus all other revolving debt payments.

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An example using a GROSS INCOME of $45,000($3,750 monthly) is:

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$3,750 X .28 = $1,050 allowed for housing expense.

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$3,750 X .36 = $1,350 allowed for housing expense plus recurring debt.

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FHA and VA loans have different Debt to Income ratios that are higher than the 28/36 example above.

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The buyer?s specialists at Lezamiz Real Estate will help you calculate your information and are knowledgeable about many special financing programs.

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For a simple Debt to Income calculator, click HERE

Source: http://www.lezamizrealestate.com/Blog/When-Buying-a-HomeFirst-Things-First

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