Figure out how much you can afford when buying your home.

Before you start looking for your dream home, let’s find out how big you can dream. Knowing your true budget is the first and most important step in buying a home.

A home is a big purchase

It’s probably the most expensive thing you’ll ever buy, and there are lots of expenses you might not even know about. Some of them include:

Cost of buying a home =

One Time Costs

Down payment

Legal fees

Title insurance

Inspection fees

Property

TransferTaxes

+ Monthly Costs

Mortgage

Utilities

Maintenance

Insurance

Property taxes

 

Everybody’s total costs are different, but it’s almost guaranteed you won’t have that much money saved up. Hopefully, you have enough for a nice down payment, but for the rest…

Yes, you need a mortgage. So determine how much a bank will lend you

Head over to the next step where you’ll find helpful tips on arranging your mortgage. But the first step in determining how much a bank will lend you is to understand how much you can afford each month. This is determined using two lending principals.

Gross Debt Service Ratio (GDSR) calculation:

This lending principle simply states that your monthly housing cost should not exceed 32% of your gross monthly family income.

Igor Veric

Igor Veric

Sales Representative
CENTURY 21 Heritage Group Ltd., Brokerage*
Contact Me

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