Before you start looking for that Dream home, lets find out how big your dream can be.When you know your true budget, this is the first and most important step in buying a home.
Calculate your Mortgage : A home is a big purchase.
It is for sure one of the most expensive things that you will ever buy, and many expenses that you might not even have thought or known about. Including:
One Time Costs:
Down Payment, Legal Fees, Title Insurance, Inspection Fees, Property Transfer, Taxes
Mortgage, Utilities, Maintenance, Insurance, Property Taxes.
Everyone's total costs are different, Hopefully you have , housing costs, credit card and lease payments)aved enough for a good downpayment. But, for the rest.......
Yes, you need a mortgage!So you need to determine how much the bank will lend you.
And to determione how much you can afford each month. This is determined by using two lending principles.
Gross Debt Service Ratio Calculation: This lending principle simply states that your monthly housing cost should not exceed 32% of your gross monthly family income.
Total Debt Service Ratio Calculation: This lending principl summarizes that your monthly housing cost and payments on all your other debts, (loans , credit card and lease payments) should not exceed 40% of your gross monthly income.
Check out the WHAT YOU CAN AFFORD CALCULATOR and the MORTGAGE CALCULATOR on howrealtorshelp.ca Just enter your monthly income and expense and the calculator will do the rest. Then once your monthly total is estimated, you can compare this number to the mortgage payments. Simply enter the loan amount, and the monthly principal and interest will be figured out for you.
This blog taken from howrealtorshelp.ca