How Much House?

Deciding how much house you can afford is a personal decision based on a number of factors. Factors like the following come into play: 1) How much you can borrow, which will be based on your credit, income, and assets. 2) How much you are able to pay for your down payment. 3) What you can afford as a monthly payment. 4) The length of the loan. 5) Etc. Since every borrower’s situation is unique it is best to work through the pre-approval process with your loan officer. This process will allow you to untimely make this important fiscal decision.

Large Or Small Down Payment

The length of your mortgage can have a bearing on the amount of money you can and perhaps should use as a down payment. As an example, if you plan on a 30 year mortgage, you can probably make a lower down payment (or perhaps no down payment at all) and still manage the monthly payments. If, on the other hand, you plan on a 15 year mortgage, you’ll probably want to make a larger down payment to keep your monthly payments affordable.

Many buyers look at their cash on hand as their only source for their down payment. There are other options that should be explored. One way to fund or partially fund a down payment is by using a gift. Parents, grandparents and other family members may be in positions to help by making a cash gift toward the purchase of your home.

There are also down payment assistance charities that can help you. And, of course, if you are selling a home, the equity you’ve built up can be applied to your down payment. At Flagship Financial we can help you explore all your down payment options, including low down payment and 100% mortgage financing.

My Monthly Payment

When determining the amount you can devote to your monthly mortgage, you must consider your other monthly expenses. Your monthly expenses for things like car payments, utilities, day care, insurance, etc. all impact what you can afford. Your lifestyle expenses also need to be considered, as well as whether you are willing to delay or can eliminate some of your expenses in order to afford a larger monthly payment.

What Amount Can I Borrow?

“Pre-approval” is the key to addressing this question and is something you’ll want to get answered prior to your home search. Pre-approval is something that we are here to help you complete – this is our job. Our mortgage calculators can assist you in answering many of your “what if” financial questions.