salaries

Before purchasing a home, is there a certain amount in combined income that is required for taking out mortgages etc.

Between FH and I, we should be ok we did, but then of course I'm paranoid so I start to worry what if its not enough.

Re: salaries

I hear ya... we havent started to look yet for a house but of course... it is def on our minds.

Re: salaries

How much you make determines how much house you can be prequalified for. So there isn't a minimum, persay, it depends on how much house you are looking at. Also...they consider income to debt ratio. How much income does your debt eat monthly. Yadda Yadda.....

Re: salaries

i believe income affects how much mortgage you will get approved for, heres a calculator that may help u!
just under mortage calculators click how much home can you afford...hope it helps!http://www.bankrate.com/brm/rate/calc_home.asp

Re: salaries

I think it may depend on your credit too right?

Re: salaries

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Posted by Nina

How much you make determines how much house you can be prequalified for. So there isn't a minimum, persay, it depends on how much house you are looking at. Also...they consider income to debt ratio. How much income does your debt eat monthly. Yadda Yadda.....

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OK i must have done something wrong. it said I could afford a home for $700,000.00 i'm very excited but know this is far from true lol.

Re: salaries

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Posted by N.Y.bride

I think it may depend on your credit too right?

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our credfit is good not worried about that. And the mortgage amt we need isnt high we're putting down a good chunk anywhere from 20-25 percent of the house amount. so i'm pretty sure we'll be ok we cal. all monthly expenses and added an additional couple hundred on top of that for 'misc expenses in case of anything' and we were fine with money to still put into savings, but of course i'm just paranoid.

Re: salaries

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Posted by rockysbride

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Posted by Nina

How much you make determines how much house you can be prequalified for. So there isn't a minimum, persay, it depends on how much house you are looking at. Also...they consider income to debt ratio. How much income does your debt eat monthly. Yadda Yadda.....

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OK i must have done something wrong. it said I could afford a home for $700,000.00 i'm very excited but know this is far from true lol.

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well you have to be careful, people are getting approved for more they can really afford right now, so if it says 700,000 you should budget for less..i believe credit affects it too, worse credit, higher rate, harder to get approved...mopre down payment and better credit easier it is and better rate

Re: salaries

Um..................Francine. I just used that bankrate mortgage calculator you gave us the link to...and it said fh and i can afford 1.6 million........um...I can guarantee thats a no no..

I'm gonna have to say that thing is not right

Re: salaries

i think i was told once that you should be able to afford your monthly mortgage payment with one weeks pay...

Re: salaries

A good rule of thumb is 2 1/2 times your total income. Ex. If total income is 100,000 than you can get approved for about $250, 000. Hope this helps.

Re: salaries

go to www.fanniemae.com they have good calculators.

yes it depends on your income, but also how much $ you put down.

Usually your credit has an effect on the rate, not the amount that you will be lent.

and the qualifying ratios differ with each lender.

I think the norm is the mortgage payment shouldnt be more than 30% of your GROSS income and your total debt, including your mortgage, shouldnt be more than 40% of your gross income.

hth

eta: when you use the calculators, make sure you include taxes and insurance - the default on the calculators is way less than the taxes on LI!

Re: salaries

Thanks everyone i feel so much better. i was hearing different numbers and i was like ok this is not making any sense whatsoever. but i just got confirmation at work thats its 30percent of your gross income so we're omre than fine.

Re: salaries

they use gross income because of the many tax brakes/changes that go along with the mortgage and owning a home.


good luck!

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Posted by Nina

Um..................Francine. I just used that bankrate mortgage calculator you gave us the link to...and it said fh and i can afford 1.6 million........um...I can guarantee thats a no no..

I'm gonna have to say that thing is not right

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nina you been holding out on us???lol, that is very weird, somethings def not right with that!...hmmm gotta find a different calculator, dont use this one ladies, it was right for me couple months ago, said almost 300,000, now its not working right for me either...

Re: salaries

i've been told that its 2.5 x's your gross salary

Re: salaries

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Posted by Soon2BeMrsD

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Posted by Nina

Um..................Francine. I just used that bankrate mortgage calculator you gave us the link to...and it said fh and i can afford 1.6 million........um...I can guarantee thats a no no..

I'm gonna have to say that thing is not right

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nina you been holding out on us???lol, that is very weird, somethings def not right with that!...hmmm gotta find a different calculator, dont use this one ladies, it was right for me couple months ago, said almost 300,000, now its not working right for me either...

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make sure the taxes are correct - alot of the calcs default at $1000 a year in property taxes, or some ridiculous $$ to us LIers. changing your taxes from $1000 to $6000 makes your affordability go down quite a bit!

Re: salaries

they use your debt to income ratio to determine how much they will lend you.....becareful, to be honest FH and I have been through this already buying our home and 'pre-approval' doesnt really mean that much since they really dont check your credit and your outgoing debt in detail...they just ask a few questions and your income......knowledge is defintiely power not to sounds soooo cliche, but its true we became educated about the whole process before we started looking and that enabled us to have an upperhand in the whole process....it can be stressful but its all worth it in the end!!!
GL to you and fh :)