How does a lender determine the maximum mortgage I can afford?
The three primary areas lenders examine in determining the size of mortgage you can handle include your monthly income, non-housing expenses, and cash available for down payment, moving expenses and closing costs. There are a number of different ways lenders interpret these variables to estimate your mortgage capacity. The most popular method is detailed here. Most lenders feel a family should spend no more than 28% of its gross monthly income on housing costs, including the mortgage, insurance, and real estate taxes. Also, these housing costs plus your long-term debts (car loans, student loans, etc.) shouldnt exceed 36% of your income. If your down payment is 10% or lower, most lenders will tighten these restrictions even further. Some lenders may also include home maintenance costs and utility payments in their calculations.
The three primary areas lenders examine in determining the size of mortgage you can handle include your monthly income, non-housing expenses, and cash available for down payment, moving expenses and closing costs. There are a number of different ways lenders interpret these variables to estimate your mortgage capacity. The most popular method is detailed here. Most lenders feel a family should spend no more than 28% to 29% of its gross monthly income on housing costs, including the mortgage, insurance, and real estate taxes. Also, these housing costs plus your long-term debts (car loans, student loans, etc.) shouldn’t exceed 36% to 41% of your income. If your down payment is 5% or lower, lenders may tighten these restrictions even further. If you are buying a condominium, most lenders will also include the monthly condo dues in their calculations.
The three primary areas lenders examine in determining the size of mortgage you can handle include your monthly income, nonhousing expenses, and cash available for down payment, moving expenses and closing costs. There are a number of different ways lenders interpret these variables to estimate your mortgage capacity. The most popular method is detailed here. Most lenders feel a family should spend no more than 28% to 29% of its gross monthly income on housing costs, including the mortgage, insurance, and real estate taxes. Also, these housing costs plus your long-term debts (car loans, student loans, etc.) shouldn’t exceed 36% to 41% of your income. If your down payment is 5% or lower, lenders may tighten these restrictions even further. If you are buying a condominium, most lenders will also include the monthly condo dues in their calculations.
The four primary areas lenders examine in determining the size of mortgage you can handle include your monthly income, dept, credit rating, and cash available for down payment, and closing costs. There are a number of different ways lenders interpret these variables to estimate your mortgage capacity. The most popular method is detailed here. Most lenders feel a family should spend no more than 28% of its gross monthly income in housing costs, including the mortgage, insurance, and real estate taxes. Also, these housing costs plus your long-term debts (car loans, student loans, etc.) shouldn’t exceed 36% of your income. If your down payment is 10% or lower, lenders may tighten these restrictions.
The three primary areas lenders examine in determining the size of mortgage you can handle include your monthly income, non-housing expenses, and cash available for down payment, moving expenses and closing costs. There are a number of different ways lenders interpret these variables to estimate your mortgage capacity. The most popular method is detailed here. Most lenders feel a family should spend no more than 28% to 29% of its gross monthly income on housing costs, including the mortgage, insurance, and real estate taxes. Also, these housing costs plus your long-term debts (car loans, student loans, etc.) shouldn’t exceed 36% to 41% of your income. If your down payment is 5 % or lower, lenders may tighten these restrictions even further. If you are buying a condominium, most lenders will also include the monthly condo dues in their calculations.
