How much can I afford?

2 Replies

The best way to find that out is to go and talk to a lender, that way you don't run across any surprises.

Depending on what kind of financing you are looking for, banks will have a debt to income ratio they look at. The max for most mortgages is going to be about 43%, but some lenders may be less than that. To figure out your debt to income range you will add your total payments together and divide by total gross (before tax) monthly income.

If you had zero debt, then you could theoretically acquire a payment of up to 43% of your monthly income. But again, most lenders are going to have different criteria so you really need to sit down with a few lenders to get a better idea of what you could specifically qualify for. 

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