How does a mortgage work? Fh and I are going to begin looking at townhomes within the next few months and I know nothing about this!
If we know how much we can afford per month on our mortgage, how do we decide how much we can spend on a house? Does that make sense? For example (our situation is alittle different....we get a housing allowance per month from the army) our housing allowance per month is $900 -- so we can afford to pay $900 per month for our mortgage. Do we tell our real estate agent that and then she'll say 'oh, then you can afford this house' or do we calculate it up and figure out our house budget that way?
I dont know if this makes sense at all....but if anyone can explain to me how we go about determining how much we can afford to spend on a home it would be a huge help
MrsMagoo
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Re: House-buying/Mortgage question
Hopefully this site will be able to help u calculate everything. Any questions let me know...
Real Estate agents or mortgage companies should be able to tell you how much payments are going to be. Then you will know what you can afford.
LaurenluvsTJ
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Re: House-buying/Mortgage question
You should talk to a mortgage broker or banker. He/She will put collect all your info and will be able to tell you what your monthly payment would be including interest, taxes, insurance, etc. Then you will be able to determine how much house you can afford. If you would like a recommendation, send me an FM and I'll give y ou the name and # of the guy we are using.
maureen519
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Re: House-buying/Mortgage question
my father owns a mortgage company....if you want some info, fm me.
woobie113007
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Re: House-buying/Mortgage question
I think when you get pre-approved for the mortgage, they determine it that way. When FH ans I got preapproved, the told us that with both of our salaries, we can get a house thats 525,000.......... Yeah right.....we didnt even come close to spending that on the house we bought.
ML110
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Re: House-buying/Mortgage question
a mortgage broker or real estate agent should be able to tell you... BUT BE CAREFUL!!! a lot of times, they'll tell you that yuo can afford more than you really can, because they dont't consider your other monthly expenses ( ie eating out, gas for the car,etc) only you know how much 'extra' money you need per month after the mortgage. I did just read an article that said that housing should be no more than about 30% of your monthly take home pay. so, if you make $5000 a month, yoru mortgage shuold be no more than about $1500. good luck! its scary stuff, but so exciting when you have a place thats yours!!
ali120206
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Re: House-buying/Mortgage question
Posted by ML110
a mortgage broker or real estate agent should be able to tell you... BUT BE CAREFUL!!! a lot of times, they'll tell you that yuo can afford more than you really can, because they dont't consider your other monthly expenses ( ie eating out, gas for the car,etc) only you know how much 'extra' money you need per month after the mortgage. I did just read an article that said that housing should be no more than about 30% of your monthly take home pay. so, if you make $5000 a month, yoru mortgage shuold be no more than about $1500. good luck! its scary stuff, but so exciting when you have a place thats yours!!
I agree, we were prequalified for an amount we definitely couldn't afford.
If you are buying a townhome, you will have to take into account that on top of mortgage, insurance and taxes, you will also have to pay maintenance fees!
Kara and Todd
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You need to talk to a mortgage broker... A LOT will depend on the interest rate you get...
AeroJenn
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Thanks girls. Ugh....this sounds so stressful
lredhead79
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Re: House-buying/Mortgage question
I work for a Mtg. Bank. You need to figure out what you can afford mo. for a mtg payment. Someone fwd a mtg calculator. Thats a good start. Im not an u/w so I cant help you with the different types of programs but I can tell you that once you know the range that your looking to spend the u/w will figure out what your ratios are and decide whether or not you are approved for a mtg (ratios inc. you dept, income, etc)
LornaandPeter
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Re: House-buying/Mortgage question
I work for wells fargo mortgage bank ,, please FM me and I will help you
lredhead79
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Re: House-buying/Mortgage question
Posted by LornaandPeter
I work for wells fargo mortgage bank ,, please FM me and I will help you
Oooh! Do you know if you are hiring? (...sorry, had to ask...trying to get out of where I am)
Bridex100
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Re: House-buying/Mortgage question
We just bought a house this weekend.
I would recommend that you talk to the banker first to figure out approximately how much house you can afford. That is what we did. Then you'll know what homes are in your price range. Now we picked a house that we can afford and we have the mortgage all lined up.
The mortgage banker will ask you questions like how much money you have, how much you have to put down on a house, student loans, car payments, etc. etc.
Keep in mind that you have to pay taxes and insurance on top of the principal repayment and interest. That increases your monthly payment quite a bit.
