How much mortgage can I expect?

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Ok So me and my girlfriend are planning to buy your house for 6 years. I was wondering if anyone here could give us a clue what we could get approved for a mortgage. We are looking for a semi-serious and just take a number in mind, without having to go out and fill in all the papers and whatnot. He is currently working to make the doctor’s office about 35,000 a year and I am currently making about 54,000 police officers working for about 2 years, however, I am full treatment, which has 85,000 base salary, plus we get the details, which he knocks another 5000th But from the moment of our salaries would be the total area of ​​90,000. Just curious, what are we likely to be approved for the first time owners and so on. Even now, we’re both 24 years old and just now the only “bills” we have a car payment and insurance, which may be equal, I would say 500 euros per month each. Thank you for all inputs.

  1. Reply
    Spock (rhp)
    April 29, 2011 at 11:13 pm

    get married first. lenders like that.

    save a down payment — 2/3rds of your joint annual income makes a fine target.

    make sure your credit quality is good — pay everything on time, every time.

    house … 3.5 times your joint 90k income = cost of about 315k maximum.

    down payment — 20% of that = 63k

    financed — 80% or 252k

    payments — see or yahoo finance for current quaotes in your area. add insurance and taxes, plus association fees, etc. as necessary.

    current estimate — 1350/month, plus — maybe 800 in extras, or total of 2150 [depends heavily on WHERE you are].

    thus PITI/income ratio is 2150/7500 = 29% … acceptable

    total payments/income ratio is [2150 + 500] / 7500 = 35% … a tad high, imo, and likely can be found. would help if car payments and/or credit cards are paid off by then.

    subject to appraisal, repair inspection, termite inspection, title, and credit quality, of course.

  2. Reply
    Plays with Squirrels
    April 29, 2011 at 11:52 pm

    Hi Jason,
    A lot of things have changed since I bought my house 10 years ago.

    But here’s some info to get you started on the path of doing your own calculations… (this is not exact, just an approximation)

    1. Generally, the lender will evaluate the ratio of “monthly” debt (including mortgage) to gross income to make sure it does not exceed 35% (this percentage may have changed, if so, not by much)

    2. In your case, given the $ 90K household income, take your income and divide by 12 to get your monthly income. This equals $ 7,500 monthly.

    3. Next multiply your monthly income by 30% to get the amount of monthly mortgage for which you qualify. In your case, $ 7500 x 35% = $ 2,250. I’m using to 30% represent the portion of your total debt which represents the mortgage. Thsi percentage may be different in accordance with your actual other debt items. Just adjust it.

    Get yourself working on saving for a 10% down payment. Not sure exactly how much, but given your mortgage ratio it will probably be in the neighborhood of $ 25K. Work with a loan broker to determine this figure more precisely and start saving (or continue saving… aggresively) The lender will also want to see that you have a savings account with some cash. Plan on $ 5K

    Other stuff: Make sure your credit history is spotless. If it isn’t start working on it. Get a credit report and review it for inaccuracies. Inaccuracies can easily be fixed.

    On a personal note, it would be much better if you and your girlfriend were married (for purposes of obtaining the loan). If you’re the primary borrower on the loan, the bank or lender may disallow your girlfriend’s income because your’re not married. This would qualify you for a lesser amount on the loan.

    Start working with a bank/lender (or loan broker) to get yourself lined up so that you can be “pre-approved” on the loan. This is the best strategy because you’ll know exactly how much house you can afford to buy. And when you finally locate a home that you like, you just execute the transaction without any delays. Plus, pre-approval tends to give the buyer bargaining leverage because the seller knows you’re a sure thing with your offer.

    Hope this helps 🙂

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