Can I afford this house?

Question

How do you know what price of a house you can afford based on your salary?

Answer 1

It also depends on what other debt, and or loan payments you have every month. Use an Excel spreadsheet and put in your net income for a month minus all your expenses and see where you stand, that will give you some basis as to what you would have remaining for a mortgage. Each persons finances are different. Obviously if you have no other debt you can afford more than if you have debt. This is something you really should try to figure out for yourself, fitting your situation, and needs.

Answer 2

There are many other factors besides salary that are involved in what you will qualify for the standards they are a tightening.

Work in reverse what is your salary and what percent of that do you feel comfortable using as a house payment remembering you have all sorts of new expenses ahead of you taxes, insurance, higher utilities. Be realistic!

There are calculators on line just use google but they give you VERY high numbers and are unrealistic.

Answer 3

There are a ton of calculators that will figure this based on how much you pay on other debts and what the costs for your homeowner's insurance and propert taxes are.
Personally, I like the ones at bankrate.com.
Keep in mind that banks will probably approve a higher loan payment than you want to budget. Look at the payment and ask yourself if this seems reasonable for your budget. Don't leave it to the bank to tell you what payment you can reasonably make, they're not the ones who have to make the payment every month.

Answer 4

Bank of America Calculator


If you are a first time home buyer or qualify for low icost programs or VA there are seperate calculators.