Buying
Guide
How
Much House?
Qualifying
How Much Can I Afford?
Sources For Down Payment
How to Reduce Down Payment
One Caution
Figuring Housing Budget
Two Lender Formulas
More Mortgage Help
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How
Much House?
House hunting begins at home--with planning. The first step toward
buying a house is to sit down. Before you grab the road maps and
hit the streets, you need to do a little planning. We call it "pre-qualifying."
Simply, it's determining how much house you can afford to buy Knowing
your affordable price range will bring your househunting into focus.
Many lenders, for a small "upfront" fee, will send out
all required verification and pre-approve you for a mortgage, allowing
you the opportunity to negotiate as a cash buyer. How
much house you can afford to buy depends on two things. How much
you can afford for the monthly housing payment. And, how much
you can invest in the down payment. Monthly payments include principal
and interest on the mortgage loan, and property taxes and insurance
against fire and other hazards. These four costs are often abbreviated
"P.I.TI." (For some buyers and lenders, monthly housing
costs may also include homeowner association dues, condominium
fees and mortgage insurance.)
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