How Much House Can I Afford – Home Affordability Calculator #bankruptcy #mortgage #lenders


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Affordability calculator

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Affordability calculator help

“How much house can I afford?” is a question we hear frequently from those looking to purchase a new home. The mortgage you can afford depends on many factors, including your target monthly payment, annual income, and down payment amount.

Zillow’s mortgage affordability calculator helps you determine what you can comfortably afford to pay based on your personal circumstances. It evaluates the percentage of your monthly income that goes toward existing debts to help identify how much extra you have to spend on a mortgage payment. Your remaining income after debt and taxes should be enough to cover living expenses and savings goals, and it is wise to have some cash set aside to accommodate any unexpected repairs or financial emergencies.

Annual income This is the combined annual income for you and your co-borrower. Include all income before taxes, including base salary, commissions, bonuses, overtime, tips, rental income, investment income, alimony, child support, etc. Down payment This is the amount of money you will put towards a down payment on the house. Make sure you still have cash left over after the down payment to cover unexpected repairs or financial emergencies. Monthly debt

Include all of you and your co-borrower’s monthly debts, including: minimum monthly required credit card payments, car payments, student loans, alimony/child support payments, any house payments (rent or mortgage) other than the new mortgage you are seeking, rental property maintenance, and other personal loans with periodic payments.

Do NOT include: credit card balances you pay off in full each month, existing house payments (rent or mortgage) that will become obsolete as a result of the new mortgage you are seeking, or the new mortgage you are seeking.

Interest rate This is the interest rate for the loan you will receive. It is pre-filled with the current 30-yr fixed average rate on Zillow Mortgages. Debt-to-income (DTI) Your DTI is expressed as a percentage and is your total “minimum” monthly debt divided by your gross monthly income. The conventional limit for DTI is 36% of your monthly income, but this could be as high as 41% for FHA loans. A DTI of 20% or below is considered excellent. Income taxes This is an annual tax that governments place on individuals’ income. It includes federal tax, most states and some local entities. The national average is around 30% but can vary based on income, location, etc. Property taxes The mortgage payment calculator includes estimated property taxes. The value represents an annual tax on homeowners’ property and the tax amount is based on the home’s value. Homeowners insurance Commonly known as hazard insurance, most lenders require insurance to provide damage protection for your home and personal property from a variety of events, including fire, lightning, burglary, vandalism, storms, explosions, and more. All homeowner’s insurance policies contain personal liability coverage, which protects against lawsuits involving injuries that occur on and off your property. Mortgage insurance (PMI) Mortgage insurance is required primarily for borrowers with a down payment of less than 20% of the home’s purchase price. It protects lenders against some or most of the losses that can occur when a borrower defaults on a mortgage loan. Also known as PMI (Private Mortgage Insurance). HOA dues Typically, owners of condos or townhomes are required to pay homeowners association dues (known as HOA fees), to cover common amenities or services within the property such as garbage collection, landscaping, snow removal, pool maintenance, and hazard insurance. Loan term This is the length of time you choose to pay off your loan (e.g. 30 years, 20 years, 15 years, etc.) Full report Click on the Full Report link to see a printable report that includes mortgage payment breakdowns, total payments, and a full mortgage payment amortization calculation (table and chart). Amortization table includes ability to view amortization by year or by month.

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How Much House Can I Afford?

Home Buyer Resources

How much house can you buy?

Mortgage lenders calculate affordability based on your personal information, including income, debt expenses and size of down payment. The mortgage calculator uses similar criteria.

Here are some of the factors that lenders consider.

Debt-to-income ratios

Lenders will calculate how much of your monthly income goes toward debt payments. This calculation is called a debt-to-income ratio.

Debt-to-income ratio

Percentage of monthly income that is spent on debt payments, including mortgages, student loans, auto loans, minimum credit card payments and child support.

Debt payments / income

For example: Jessie and Pat together earn $10,000 a month. Their total debt payments are $3,800 a month. Their debt-to-income ratio is 38 percent.

$3,800 / $10,000 = 0.38

Front-end ratio

A standard rule for lenders is that your monthly housing payment (principal, interest, taxes and insurance) should not take up more than 28 percent of your income before taxes. This debt-to-income ratio is called the housing ratio or front-end ratio.

Back-end ratio

Lenders also calculate the back-end ratio. It includes all debt commitments, including car loan, student loan and minimum credit card payments, together with your house payment. Lenders prefer a back-end ratio of 36 percent or less.

Ratios aren’t carved in stone

Those recommended ratios (28 percent front-end and 36 percent back-end) aren’t ironclad. In many cases, lenders approve applicants with higher debt-to-income ratios. Under the qualified mortgage rule, federal regulations give legal protection to well-documented mortgages with back-end ratios (all debts, including house payments) up to 43 percent.

That’s been one of the bigger drivers (of affordability) because that is basically drawing a box around what’s a qualified mortgage, says Tim Skinner, home lending sales and service manager for Huntington Bank in Columbus, Ohio. A large portion of the lending community has decided to stay in that box.

Credit history

If you have a good credit history, you are likely to get a lower interest rate, which means you could take on a bigger loan. The best rates tend to go to borrowers with credit scores of 740 or higher.

Down payment

With a larger down payment, you will likely need to take on a smaller loan and can afford to buy a higher-priced house.

Down payment

Money from your savings that you give to the home’s seller. A mortgage pays the rest of the purchase price. It’s usually expressed as a percentage: On a $100,000 home, a $13,000 down payment would be 13 percent.

You don’t need to have a perfect credit score or a 20 percent down payment to qualify for a mortgage. Some lenders will accept down payments as small as 3 percent. Federal Housing Administration-insured mortgages have a minimum down payment of 3.5 percent.

Lifestyle factors

While the lender’s guidelines are a good place to start, consider how your lifestyle affects how much of a mortgage you can take on. For instance, if you send your children to a private school, that is a major expense that lenders don’t typically account for. Or maybe you like to spend a lot on dining out or clothes. And if you live in a city with good public transportation, such as San Francisco or New York, and are able to rely on public transportation, you can likely afford to spend more on housing.

Consider all your options

Look into various state government programs that provide certain concessions, especially for first-time homebuyers. There also are programs that you might qualify for based on your income or occupation. You may be able to get assistance with your down payment so you can take on a smaller loan.

Nikitra Bailey, executive vice president for the Center for Responsible Lending in Durham, North Carolina, says, A lot of creditworthy borrowers have been unable to secure mortgages in the tighter mortgage environment. We are hopeful that these efforts will open up credit for borrowers who are deserving so that we will see an increase in first-time homebuyers going forward.

Don’t overload yourself

Be careful. It’s wise to give yourself breathing room financially. You don’t have to deplete your savings, and you don’t have to make the maximum monthly payment that you qualify for.

Why is it wise to spend less than you can afford? As a homeowner, you will face unexpected expenses, such as a leaky roof or a failed water heater. You will have to pay for maintenance. You might even face a job loss.

When gas prices started to go up (during the housing downturn) and people were maxed out on their homes, that’s when we started seeing a lot of the defaults happen, says Kathy Cummings, homeownership solutions and education executive for Bank of America. There were a lot of other economic factors going into it, but if you are maxing yourself out on your home, you can’t absorb some of those impacts.

HOME BUYER TIPS


How Much House Can I Afford? New House Calculator #regions #mortgage


#house payment

#

How Much House Can I Afford?

Home Buyer Resources

How much house can you buy?

Mortgage lenders calculate affordability based on your personal information, including income, debt expenses and size of down payment. The mortgage calculator uses similar criteria.

Here are some of the factors that lenders consider.

Debt-to-income ratios

Lenders will calculate how much of your monthly income goes toward debt payments. This calculation is called a debt-to-income ratio.

Debt-to-income ratio

Percentage of monthly income that is spent on debt payments, including mortgages, student loans, auto loans, minimum credit card payments and child support.

Debt payments / income

For example: Jessie and Pat together earn $10,000 a month. Their total debt payments are $3,800 a month. Their debt-to-income ratio is 38 percent.

$3,800 / $10,000 = 0.38

Front-end ratio

A standard rule for lenders is that your monthly housing payment (principal, interest, taxes and insurance) should not take up more than 28 percent of your income before taxes. This debt-to-income ratio is called the housing ratio or front-end ratio.

Back-end ratio

Lenders also calculate the back-end ratio. It includes all debt commitments, including car loan, student loan and minimum credit card payments, together with your house payment. Lenders prefer a back-end ratio of 36 percent or less.

Ratios aren’t carved in stone

Those recommended ratios (28 percent front-end and 36 percent back-end) aren’t ironclad. In many cases, lenders approve applicants with higher debt-to-income ratios. Under the qualified mortgage rule, federal regulations give legal protection to well-documented mortgages with back-end ratios (all debts, including house payments) up to 43 percent.

That’s been one of the bigger drivers (of affordability) because that is basically drawing a box around what’s a qualified mortgage, says Tim Skinner, home lending sales and service manager for Huntington Bank in Columbus, Ohio. A large portion of the lending community has decided to stay in that box.

Credit history

If you have a good credit history, you are likely to get a lower interest rate, which means you could take on a bigger loan. The best rates tend to go to borrowers with credit scores of 740 or higher.

Down payment

With a larger down payment, you will likely need to take on a smaller loan and can afford to buy a higher-priced house.

Down payment

Money from your savings that you give to the home’s seller. A mortgage pays the rest of the purchase price. It’s usually expressed as a percentage: On a $100,000 home, a $13,000 down payment would be 13 percent.

You don’t need to have a perfect credit score or a 20 percent down payment to qualify for a mortgage. Some lenders will accept down payments as small as 3 percent. Federal Housing Administration-insured mortgages have a minimum down payment of 3.5 percent.

Lifestyle factors

While the lender’s guidelines are a good place to start, consider how your lifestyle affects how much of a mortgage you can take on. For instance, if you send your children to a private school, that is a major expense that lenders don’t typically account for. Or maybe you like to spend a lot on dining out or clothes. And if you live in a city with good public transportation, such as San Francisco or New York, and are able to rely on public transportation, you can likely afford to spend more on housing.

Consider all your options

Look into various state government programs that provide certain concessions, especially for first-time homebuyers. There also are programs that you might qualify for based on your income or occupation. You may be able to get assistance with your down payment so you can take on a smaller loan.

Nikitra Bailey, executive vice president for the Center for Responsible Lending in Durham, North Carolina, says, A lot of creditworthy borrowers have been unable to secure mortgages in the tighter mortgage environment. We are hopeful that these efforts will open up credit for borrowers who are deserving so that we will see an increase in first-time homebuyers going forward.

Don’t overload yourself

Be careful. It’s wise to give yourself breathing room financially. You don’t have to deplete your savings, and you don’t have to make the maximum monthly payment that you qualify for.

Why is it wise to spend less than you can afford? As a homeowner, you will face unexpected expenses, such as a leaky roof or a failed water heater. You will have to pay for maintenance. You might even face a job loss.

When gas prices started to go up (during the housing downturn) and people were maxed out on their homes, that’s when we started seeing a lot of the defaults happen, says Kathy Cummings, homeownership solutions and education executive for Bank of America. There were a lot of other economic factors going into it, but if you are maxing yourself out on your home, you can’t absorb some of those impacts.

HOME BUYER TIPS


How Much House Can I Afford? New House Calculator #figure #mortgage #payment


#house payment

#

How Much House Can I Afford?

Home Buyer Resources

How much house can you buy?

Mortgage lenders calculate affordability based on your personal information, including income, debt expenses and size of down payment. The mortgage calculator uses similar criteria.

Here are some of the factors that lenders consider.

Debt-to-income ratios

Lenders will calculate how much of your monthly income goes toward debt payments. This calculation is called a debt-to-income ratio.

Debt-to-income ratio

Percentage of monthly income that is spent on debt payments, including mortgages, student loans, auto loans, minimum credit card payments and child support.

Debt payments / income

For example: Jessie and Pat together earn $10,000 a month. Their total debt payments are $3,800 a month. Their debt-to-income ratio is 38 percent.

$3,800 / $10,000 = 0.38

Front-end ratio

A standard rule for lenders is that your monthly housing payment (principal, interest, taxes and insurance) should not take up more than 28 percent of your income before taxes. This debt-to-income ratio is called the housing ratio or front-end ratio.

Back-end ratio

Lenders also calculate the back-end ratio. It includes all debt commitments, including car loan, student loan and minimum credit card payments, together with your house payment. Lenders prefer a back-end ratio of 36 percent or less.

Ratios aren’t carved in stone

Those recommended ratios (28 percent front-end and 36 percent back-end) aren’t ironclad. In many cases, lenders approve applicants with higher debt-to-income ratios. Under the qualified mortgage rule, federal regulations give legal protection to well-documented mortgages with back-end ratios (all debts, including house payments) up to 43 percent.

That’s been one of the bigger drivers (of affordability) because that is basically drawing a box around what’s a qualified mortgage, says Tim Skinner, home lending sales and service manager for Huntington Bank in Columbus, Ohio. A large portion of the lending community has decided to stay in that box.

Credit history

If you have a good credit history, you are likely to get a lower interest rate, which means you could take on a bigger loan. The best rates tend to go to borrowers with credit scores of 740 or higher.

Down payment

With a larger down payment, you will likely need to take on a smaller loan and can afford to buy a higher-priced house.

Down payment

Money from your savings that you give to the home’s seller. A mortgage pays the rest of the purchase price. It’s usually expressed as a percentage: On a $100,000 home, a $13,000 down payment would be 13 percent.

You don’t need to have a perfect credit score or a 20 percent down payment to qualify for a mortgage. Some lenders will accept down payments as small as 3 percent. Federal Housing Administration-insured mortgages have a minimum down payment of 3.5 percent.

Lifestyle factors

While the lender’s guidelines are a good place to start, consider how your lifestyle affects how much of a mortgage you can take on. For instance, if you send your children to a private school, that is a major expense that lenders don’t typically account for. Or maybe you like to spend a lot on dining out or clothes. And if you live in a city with good public transportation, such as San Francisco or New York, and are able to rely on public transportation, you can likely afford to spend more on housing.

Consider all your options

Look into various state government programs that provide certain concessions, especially for first-time homebuyers. There also are programs that you might qualify for based on your income or occupation. You may be able to get assistance with your down payment so you can take on a smaller loan.

Nikitra Bailey, executive vice president for the Center for Responsible Lending in Durham, North Carolina, says, A lot of creditworthy borrowers have been unable to secure mortgages in the tighter mortgage environment. We are hopeful that these efforts will open up credit for borrowers who are deserving so that we will see an increase in first-time homebuyers going forward.

Don’t overload yourself

Be careful. It’s wise to give yourself breathing room financially. You don’t have to deplete your savings, and you don’t have to make the maximum monthly payment that you qualify for.

Why is it wise to spend less than you can afford? As a homeowner, you will face unexpected expenses, such as a leaky roof or a failed water heater. You will have to pay for maintenance. You might even face a job loss.

When gas prices started to go up (during the housing downturn) and people were maxed out on their homes, that’s when we started seeing a lot of the defaults happen, says Kathy Cummings, homeownership solutions and education executive for Bank of America. There were a lot of other economic factors going into it, but if you are maxing yourself out on your home, you can’t absorb some of those impacts.

HOME BUYER TIPS


How Much House Can I Afford? #prepayment #mortgage #calculator


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How We Calculate Your Home Affordability Estimate

We estimate your home affordability based on your annual income, down payment, monthly spending, loan type, and current average APR.

Annual Household Income

In order to determine how much you can afford to pay each month, we start by looking at how much you earn (salary, wages, tips, commission, etc.) each year before taxes. This should be the combined income for people searching for a home together.

Monthly Spending

Once we have your monthly expenses, we can more accurately determine how much money you have left to spend on a monthly mortgage. Take into account debt (car loans, student loans, credit cards, etc.), recurring payments (insurance, utilities, subscriptions, etc.), groceries, and even savings that would not go toward your mortgage, when calculating your monthly spending.

Loan Type

There are several types of mortgage loans, but the most commonly used are fixed-rate and adjustable-rate loans. Fixed-rate loans have the same interest rate for the entire duration of the loan. That means your monthly payment will be the same, even for long-term loans, such as 30-year fixed-rate mortgages. Two benefits to this loan type are stability, and being able to calculate your total interest up front. Adjustable-rate mortgages (ARMs) have interest rates that can change over time. Typically they start out at a lower interest rate than a fixed-rate loan, and hold that rate for a set number of years, before changing interest rates from year to year. For example, if you have a 5/1 ARM, you will have the same interest rate for the first 5 years, and then your interest rate will change from year to year. The main benefit of an adjustable-rate loan is starting off with a lower interest rate.

Loan Term and Interest Rate Options

The monthly amount of your mortgage payment depends on loan term (duration) and interest rate. Generally, a longer-term loan will have lower monthly payments, but at a higher interest rate, so you’ll end up paying more money overall. You can build up your credit or save for a larger down payment to qualify for a lower interest rate. A lender can also help determine a financial plan, and present the best loan payment loan term and interest rate for your needs.

APR (%)

The Annual Percentage Rate (APR) is a number designed to help you evaluate the total cost of a loan. In addition to the interest rate, it takes into account the fees, rebates, and other costs you may encounter over the life of the loan. The APR is calculated according to federal requirements, and is required by law to be stated in all mortgage loan estimates. This allows you to better compare different types of mortgages from different lenders, to see which is the right one for you.

Annual Property Tax (%)

As a homeowner, you’ll pay property tax either twice a year or as part of your monthly loan payment. This tax is a percentage of a home’s assessed value and varies by area. For example, a $500,000 home in San Francisco, taxed at a rate of 1.159%, translates to a payment of $5,795 annually. When you buy a home, you will typically have to pay some property tax back to the seller, as part of closing costs. Because property tax is calculated on the home’s assessed value, the amount typically can change drastically once a home is sold, depending on how much the home raised or decreased in value.

Monthly Mortgage Payment

When calculating how much home you can afford, we estimate how much you will pay each month toward your mortgage. Your monthly mortgage payment will include principal and interest. It can also include property taxes, homeowners’ insurance, homeowners’ association (HOA) fees, and private mortgage insurance (PMI) if your down payment is less than 20 percent. Additionally, it’s a good idea to budget one percent of your home price for home upkeep, repairs, and maintenance.

You should evaluate your personal financial situation and determine a monthly mortgage range that you feel comfortable with before you meet with a mortgage lender. When banks evaluate your home affordability, they look at your outstanding debts and not necessarily the full picture. When creating your own monthly mortgage range, you can factor in financial information that may be unknown to your lender, like budgeting for a tropical vacation next winter or planning for a baby.

Down Payment

The typical rule of thumb is to pay 20 percent of the home’s price as your down payment, although some mortgage loans require as little as 3.5 percent down. Your down payment reduces the total amount of your mortgage loan, so the more money you put down, the more expensive a house you can buy. At the same time, you can put more money down to decrease your mortgage payment each month. Use the affordability calculator to see how your down payment affects your home affordability estimate and your monthly mortgage payment.

Homes in Your Price Range

We use your home affordability estimate to determine which for-sale homes you can afford to buy in the location you specify.

Credit Scores

Though we don’t factor credit scores in our home affordability estimate, it is an important factor in qualifying for a loan and determining interest rates. Generally, the higher the credit score, the lower the interest rate will be for most loans. This means your the overall payment will be lower. Even lowering your interest rate by half a percent can save you thousands of dollars.

Financial Documents

Here are a few documents to help you understand your financial situation and how much house you can afford:

  • Recent statements from all bank and investment accounts
  • Pay stubs and W-2 income tax forms
  • Total monthly expenses, including all bills, groceries, clothing budgets, etc.
  • All of your assets, including stocks, 401(k), IRAs, bonds, cash, rental properties, etc.
  • All debt including credit cards, student loans, car loans, mortgages, etc.
  • Credit score
  • Profit and loss statements if you are self-employed
  • Gift letters if you are using a gift to help with your down payment

The affordability calculator is intended for planning and educational purposes only. The output of the tool is not a loan offer or solicitation, nor is it financial or legal advice. Talk to a lender to find out exactly how much home you can afford.

More Resources for Home Affordability


10 Most Affordable Pharmacy Schools in the US – Insider Monkey #best #pharmacy #schools #in


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Published on May 9, 2015 at 6:57 am by Jerry Tang in Lists

The most affordable pharmacy schools in the US have yearly tuition as low as $6500. You read that right. The pharmacy schools that are on our list are not only affordable, they re also pretty great. Think you can take it a step further and make the neighbors jealous, check out the The 10 Most Affordable Medical Schools in the US .

Both medicine and pharmacy have a special role in our lives. People who chose to become either pharmacists or doctors usually have a sincere wish to help people. Since unfortunately we can t even imagine having the world without any illnesses, pharmacy is an industry that will never run out of business. It s potentially profitable. Pharmacists can manage flexible work enviroments they can work in healthcare, hospitals, nursing homes, pharmaceutical industries, pharmacy schools, and managed care organizations. And, of course, with a Ph.D. they can teach pharmacy in colleges.

The pharm-d program takes 4 years to complete, and you can find various pharmacy schools in the US with high rankings and high reputes but with all the reputation you still want less burden on your pocket. Most of the schools have high tuition fees, but there are some schools with high rankings and low tuition fees. If you are searching for the most affordable pharmacy schools in the US, then you should consider studying in state schools because going to out-of-state schools would cause much more expenses.

You should keep few things in mind before deciding to take an admission to a pharmacy school. Consider location a school near to your residence is certainly a better choice than some far away. That is why in-state schools are preferred when you are worrying about the tuition fees. Also, be aware of the fact that every school has different rules and different environment for their students. And two most important things you should consider are: tuition fee and quality of the school. We hope that at least one pharmacy school from our list can be a wise choice for your studies.

There are around 140 Pharmacy Schools in the US, which makes the quest of finding out most affordable ones pretty hard. We ve narrowed down our research to some of the universities that are known for their affordable tuition and fee prices. But keep in mind that all prices stated below are estimates (even on their websites it is always stated that those are only estimated prices, which can change easily). So, for the most accurate information about the tuition and fees, we advise you to contact directly the administrative office of the college you are interested in. And here are the most affordable pharmacy schools in the US that we ve found:


How Much House Can You Afford? #mortgage #leads


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How Much House Can You Afford?

“How much house can I afford?” Depending on whom you ask, you could get some surprisingly different answers.

There is no magic dollar amount for the “perfect home.” How much house you can afford is as unique as you are and is based on many factors your location, income, savings, personal preferences, and most importantly, the house-buying plan you have in place.

Before you consider buying a home, you should be debt-free and have three to six months of expenses saved in addition to your down payment (more on that later). Being debt-free with money in the bank will keep you from losing your home in the event of a job loss or illness.

Local experts you can trust.

Also, if you’re married, you should be married for at least a year before you buy a home. Don’t add the stress of a home purchase to a brand new marriage, and never buy real estate with anyone you’re not married to

The ideal way to buy a home is the 100%-down plan. Sounds weird, doesn’t it? But think how much fun that would be. No mortgage! No payments!

If you can’t postpone the purchase until you can pay cash, buy a home with a down payment of at least 10% on a 15-year (or less) fixed-rate mortgage. Limit your monthly payment to 25% or less of your monthly take-home pay.

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You want your new home to be a blessing, not a curse. If you buy a house with nothing down and a huge monthly payment, you’re inviting Murphy to move into the spare bedroom. That means everything that can go wrong will go wrong believe it!

Use thischecklist of important questions as you determine how much house you can afford. If you cannot answer “yes” to these questions regarding the house you have your eye on, then it’s not a wise move to buy it right now.

  • Can I make at least a 10% (preferably a 20%) down payment?
  • Can I keep house payments at or below 25% of my monthly take-home pay? Here’s a calculator to help you quickly calculate your payment.
  • Can I afford to take out a 15-year fixed-rate loan?
  • Am I working closely with a real estate agent I can trust?

If your’re ready to buy a home a real estate Endorsed Local Provider will ensure you get a great house you can afford.

Local experts you can trust.


How Much House Can I Afford? #home #mortgage #calculator #with #taxes


#home calculator

#

How We Calculate Your Home Affordability Estimate

We estimate your home affordability based on your annual income, down payment, monthly spending, loan type, and current average APR.

Annual Household Income

In order to determine how much you can afford to pay each month, we start by looking at how much you earn (salary, wages, tips, commission, etc.) each year before taxes. This should be the combined income for people searching for a home together.

Monthly Spending

Once we have your monthly expenses, we can more accurately determine how much money you have left to spend on a monthly mortgage. Take into account debt (car loans, student loans, credit cards, etc.), recurring payments (insurance, utilities, subscriptions, etc.), groceries, and even savings that would not go toward your mortgage, when calculating your monthly spending.

Loan Type

There are several types of mortgage loans, but the most commonly used are fixed-rate and adjustable-rate loans. Fixed-rate loans have the same interest rate for the entire duration of the loan. That means your monthly payment will be the same, even for long-term loans, such as 30-year fixed-rate mortgages. Two benefits to this loan type are stability, and being able to calculate your total interest up front. Adjustable-rate mortgages (ARMs) have interest rates that can change over time. Typically they start out at a lower interest rate than a fixed-rate loan, and hold that rate for a set number of years, before changing interest rates from year to year. For example, if you have a 5/1 ARM, you will have the same interest rate for the first 5 years, and then your interest rate will change from year to year. The main benefit of an adjustable-rate loan is starting off with a lower interest rate.

Loan Term and Interest Rate Options

The monthly amount of your mortgage payment depends on loan term (duration) and interest rate. Generally, a longer-term loan will have lower monthly payments, but at a higher interest rate, so you’ll end up paying more money overall. You can build up your credit or save for a larger down payment to qualify for a lower interest rate. A lender can also help determine a financial plan, and present the best loan payment loan term and interest rate for your needs.

APR (%)

The Annual Percentage Rate (APR) is a number designed to help you evaluate the total cost of a loan. In addition to the interest rate, it takes into account the fees, rebates, and other costs you may encounter over the life of the loan. The APR is calculated according to federal requirements, and is required by law to be stated in all mortgage loan estimates. This allows you to better compare different types of mortgages from different lenders, to see which is the right one for you.

Annual Property Tax (%)

As a homeowner, you’ll pay property tax either twice a year or as part of your monthly loan payment. This tax is a percentage of a home’s assessed value and varies by area. For example, a $500,000 home in San Francisco, taxed at a rate of 1.159%, translates to a payment of $5,795 annually. When you buy a home, you will typically have to pay some property tax back to the seller, as part of closing costs. Because property tax is calculated on the home’s assessed value, the amount typically can change drastically once a home is sold, depending on how much the home raised or decreased in value.

Monthly Mortgage Payment

When calculating how much home you can afford, we estimate how much you will pay each month toward your mortgage. Your monthly mortgage payment will include principal and interest. It can also include property taxes, homeowners’ insurance, homeowners’ association (HOA) fees, and private mortgage insurance (PMI) if your down payment is less than 20 percent. Additionally, it’s a good idea to budget one percent of your home price for home upkeep, repairs, and maintenance.

You should evaluate your personal financial situation and determine a monthly mortgage range that you feel comfortable with before you meet with a mortgage lender. When banks evaluate your home affordability, they look at your outstanding debts and not necessarily the full picture. When creating your own monthly mortgage range, you can factor in financial information that may be unknown to your lender, like budgeting for a tropical vacation next winter or planning for a baby.

Down Payment

The typical rule of thumb is to pay 20 percent of the home’s price as your down payment, although some mortgage loans require as little as 3.5 percent down. Your down payment reduces the total amount of your mortgage loan, so the more money you put down, the more expensive a house you can buy. At the same time, you can put more money down to decrease your mortgage payment each month. Use the affordability calculator to see how your down payment affects your home affordability estimate and your monthly mortgage payment.

Homes in Your Price Range

We use your home affordability estimate to determine which for-sale homes you can afford to buy in the location you specify.

Credit Scores

Though we don’t factor credit scores in our home affordability estimate, it is an important factor in qualifying for a loan and determining interest rates. Generally, the higher the credit score, the lower the interest rate will be for most loans. This means your the overall payment will be lower. Even lowering your interest rate by half a percent can save you thousands of dollars.

Financial Documents

Here are a few documents to help you understand your financial situation and how much house you can afford:

  • Recent statements from all bank and investment accounts
  • Pay stubs and W-2 income tax forms
  • Total monthly expenses, including all bills, groceries, clothing budgets, etc.
  • All of your assets, including stocks, 401(k), IRAs, bonds, cash, rental properties, etc.
  • All debt including credit cards, student loans, car loans, mortgages, etc.
  • Credit score
  • Profit and loss statements if you are self-employed
  • Gift letters if you are using a gift to help with your down payment

The affordability calculator is intended for planning and educational purposes only. The output of the tool is not a loan offer or solicitation, nor is it financial or legal advice. Talk to a lender to find out exactly how much home you can afford.

More Resources for Home Affordability


How Much House Can I Afford – Home Affordability Calculator #home #refinance #rates


#payment calculator home

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Affordability calculator

See how much refinancing can save you

Affordability calculator help

“How much house can I afford?” is a question we hear frequently from those looking to purchase a new home. The mortgage you can afford depends on many factors, including your target monthly payment, annual income, and down payment amount.

Zillow’s mortgage affordability calculator helps you determine what you can comfortably afford to pay based on your personal circumstances. It evaluates the percentage of your monthly income that goes toward existing debts to help identify how much extra you have to spend on a mortgage payment. Your remaining income after debt and taxes should be enough to cover living expenses and savings goals, and it is wise to have some cash set aside to accommodate any unexpected repairs or financial emergencies.

Annual income This is the combined annual income for you and your co-borrower. Include all income before taxes, including base salary, commissions, bonuses, overtime, tips, rental income, investment income, alimony, child support, etc. Down payment This is the amount of money you will put towards a down payment on the house. Make sure you still have cash left over after the down payment to cover unexpected repairs or financial emergencies. Monthly debt

Include all of you and your co-borrower’s monthly debts, including: minimum monthly required credit card payments, car payments, student loans, alimony/child support payments, any house payments (rent or mortgage) other than the new mortgage you are seeking, rental property maintenance, and other personal loans with periodic payments.

Do NOT include: credit card balances you pay off in full each month, existing house payments (rent or mortgage) that will become obsolete as a result of the new mortgage you are seeking, or the new mortgage you are seeking.

Interest rate This is the interest rate for the loan you will receive. It is pre-filled with the current 30-yr fixed average rate on Zillow Mortgages. Debt-to-income (DTI) Your DTI is expressed as a percentage and is your total “minimum” monthly debt divided by your gross monthly income. The conventional limit for DTI is 36% of your monthly income, but this could be as high as 41% for FHA loans. A DTI of 20% or below is considered excellent. Income taxes This is an annual tax that governments place on individuals’ income. It includes federal tax, most states and some local entities. The national average is around 30% but can vary based on income, location, etc. Property taxes The mortgage payment calculator includes estimated property taxes. The value represents an annual tax on homeowners’ property and the tax amount is based on the home’s value. Homeowners insurance Commonly known as hazard insurance, most lenders require insurance to provide damage protection for your home and personal property from a variety of events, including fire, lightning, burglary, vandalism, storms, explosions, and more. All homeowner’s insurance policies contain personal liability coverage, which protects against lawsuits involving injuries that occur on and off your property. Mortgage insurance (PMI) Mortgage insurance is required primarily for borrowers with a down payment of less than 20% of the home’s purchase price. It protects lenders against some or most of the losses that can occur when a borrower defaults on a mortgage loan. Also known as PMI (Private Mortgage Insurance). HOA dues Typically, owners of condos or townhomes are required to pay homeowners association dues (known as HOA fees), to cover common amenities or services within the property such as garbage collection, landscaping, snow removal, pool maintenance, and hazard insurance. Loan term This is the length of time you choose to pay off your loan (e.g. 30 years, 20 years, 15 years, etc.) Full report Click on the Full Report link to see a printable report that includes mortgage payment breakdowns, total payments, and a full mortgage payment amortization calculation (table and chart). Amortization table includes ability to view amortization by year or by month.

Mortgage Learning Center

Searching for your new home?

Pre-approval ensures you’re ready to make an offer when you find the perfect one.

More Calculators


How Much House Can I Afford – Home Affordability Calculator #home #mortgage #rates


#payment calculator home

#

Affordability calculator

See how much refinancing can save you

Affordability calculator help

“How much house can I afford?” is a question we hear frequently from those looking to purchase a new home. The mortgage you can afford depends on many factors, including your target monthly payment, annual income, and down payment amount.

Zillow’s mortgage affordability calculator helps you determine what you can comfortably afford to pay based on your personal circumstances. It evaluates the percentage of your monthly income that goes toward existing debts to help identify how much extra you have to spend on a mortgage payment. Your remaining income after debt and taxes should be enough to cover living expenses and savings goals, and it is wise to have some cash set aside to accommodate any unexpected repairs or financial emergencies.

Annual income This is the combined annual income for you and your co-borrower. Include all income before taxes, including base salary, commissions, bonuses, overtime, tips, rental income, investment income, alimony, child support, etc. Down payment This is the amount of money you will put towards a down payment on the house. Make sure you still have cash left over after the down payment to cover unexpected repairs or financial emergencies. Monthly debt

Include all of you and your co-borrower’s monthly debts, including: minimum monthly required credit card payments, car payments, student loans, alimony/child support payments, any house payments (rent or mortgage) other than the new mortgage you are seeking, rental property maintenance, and other personal loans with periodic payments.

Do NOT include: credit card balances you pay off in full each month, existing house payments (rent or mortgage) that will become obsolete as a result of the new mortgage you are seeking, or the new mortgage you are seeking.

Interest rate This is the interest rate for the loan you will receive. It is pre-filled with the current 30-yr fixed average rate on Zillow Mortgages. Debt-to-income (DTI) Your DTI is expressed as a percentage and is your total “minimum” monthly debt divided by your gross monthly income. The conventional limit for DTI is 36% of your monthly income, but this could be as high as 41% for FHA loans. A DTI of 20% or below is considered excellent. Income taxes This is an annual tax that governments place on individuals’ income. It includes federal tax, most states and some local entities. The national average is around 30% but can vary based on income, location, etc. Property taxes The mortgage payment calculator includes estimated property taxes. The value represents an annual tax on homeowners’ property and the tax amount is based on the home’s value. Homeowners insurance Commonly known as hazard insurance, most lenders require insurance to provide damage protection for your home and personal property from a variety of events, including fire, lightning, burglary, vandalism, storms, explosions, and more. All homeowner’s insurance policies contain personal liability coverage, which protects against lawsuits involving injuries that occur on and off your property. Mortgage insurance (PMI) Mortgage insurance is required primarily for borrowers with a down payment of less than 20% of the home’s purchase price. It protects lenders against some or most of the losses that can occur when a borrower defaults on a mortgage loan. Also known as PMI (Private Mortgage Insurance). HOA dues Typically, owners of condos or townhomes are required to pay homeowners association dues (known as HOA fees), to cover common amenities or services within the property such as garbage collection, landscaping, snow removal, pool maintenance, and hazard insurance. Loan term This is the length of time you choose to pay off your loan (e.g. 30 years, 20 years, 15 years, etc.) Full report Click on the Full Report link to see a printable report that includes mortgage payment breakdowns, total payments, and a full mortgage payment amortization calculation (table and chart). Amortization table includes ability to view amortization by year or by month.

Mortgage Learning Center

Searching for your new home?

Pre-approval ensures you’re ready to make an offer when you find the perfect one.

More Calculators