| How much should you borrow? is a question | | | | List out your current expenses for food, |
| people with adverse credit wrestle with. The | | | | clothing, and other regular bills. Next, |
| answer is simply as much as you can afford. | | | | decide on an amount to pay for the home, |
| This is probably less than what you will | | | | which include both the mortgage payment and |
| qualify to borrow from a mortgage lender. To | | | | home repair expenses. Most experts recommend |
| determine what you can afford, factor the | | | | paying no more than a third of your gross |
| mortgage payment and other home costs into | | | | monthly income to home expenses. |
| your budget. | | | | |
| | | | One factor to consider is that your mortgage |
| Cost Of A Mortgage | | | | payment will not go up, but more than likely |
| | | | your income will. So through the years, your |
| Your mortgage payment is not just the loan | | | | mortgage will take a smaller percent of your |
| payment; it also includes real estate taxes, | | | | monthly income. However, you dont want to |
| homeowners insurance, and private mortgage | | | | place yourself in too tight of a financial |
| insurance premium if you borrow more than 80% | | | | situation by planning on yearly raises. |
| of the homes value. These three items often | | | | |
| add several hundred dollars to your monthly | | | | Get A Pre-approved Mortgage |
| payment. | | | | |
| | | | Another way to find how much you can afford |
| Cost Of A Home | | | | is to apply for a pre-approved mortgage. The |
| | | | mortgage lender will approve you for a |
| Unlike renting, you will be responsible for | | | | maximum amount, but you can borrow less than |
| utility payments for your home. Home | | | | this. While you are going through the |
| utilities are usually higher than an | | | | mortgage loan process, ask how much the |
| apartment since you have more area to heat | | | | monthly mortgage payment will be. |
| and usually a lawn to water. You will also | | | | |
| need to plan on making unexpected home | | | | Shop Prices |
| repairs. This can include fixing a leaky | | | | |
| faucet, replacing appliances, or remodeling. | | | | When you do start looking at homes, ask about |
| | | | taxes. This often overlooked area makes a |
| Plan A Budget | | | | significant impact on your budget. Also, |
| | | | expect taxes to increase as the value of your |
| Before you complete the process for a | | | | home rises. |
| mortgage loan, plan out your monthly budget. | | | | |