Take 2 - Homeowners or those looking...

How much do you & FH jointly gross annually?

you dont have to post, just answering the poll is fine :)


(no im not selling a home...im wondering if FH & I are totally out of our league even trying to find a house....)

Go to a site like this

http://www.bankrate.com/brm/calc/newhouse/calculator.asp

OR

http://cgi.money.cnn.com/tools/houseafford/houseafford.html

and it will tell you how much house you can afford. It all depends on your income, monthly payments to debt, the price of the house, the taxes and how much down payment you have. The formula is something like this

1. Take your gross salary (yearly salary divided by 12)
2. Multiply by 30% (the percentage can vary by the bank and how conservative they are but cnn money said not more than 36%)
3. Then subtract all of your monthly payments towards credit cards, student loan, alimony, child support, car payment. Don't include things like insurance, cable, cell phone, utilities, etc.
4. The remainder is what you can afford to pay for your mortgage and monthly tax bill.

And remember, if you have to put 10-20% down, you have to add an ADDITIONAL $15K onto that for closing costs. So for a $200K house, you need $40K for down payment and and additional $15K for closing (= $55K - Who has that kind of money saved up?!).

You can also do a pre-approval or pre-qualification where they tell you how much house you can afford and it's free. Wells Fargo does a pre-qual too.

http://www.us.hsbc.com/1/2/3/personal/home-loans/mortgage/mortgage-programs/preapprove

We went with a 2 bedroom co-op. Closing costs are more than 10K cheaper and you can get a 1 bedroom under 200K. We found it on MLSLI.com. They have a mortgage calculator and all those tools there too.

Good luck! And let me know if you have any questions. We're experts by now!

yea it def doesnt matter what you bring in....its more about what you end up paying out.

Debt is the deal breaker