How Much House Can You Afford?

How Much House Can You Afford?

Determining how much home you can afford, or what payment you feel comfortable with, can be a trying process. Calling lenders, looking at mortgage loan programs and interest rates can be confusing. There is an easy way to get started, and give yourself an idea of where you stand.

Image: What Ever Home Buyer Should Know

1.Find out what mortgage interest rates currently. You can typically do this with a couple phone calls to lenders or some quick searching on the internet.
Here are a few local lenders we recommend:
North Shore Bank of Commerce
National Bank of Commerce

2. Contact a reputable local lender and let them analyze your entire situation. The lender can calculate your income-to-debt ratio, do a quick credit score and give you the information you need. Typically, lenders like to see a ratio at about 28% or below. (This does not take into consideration long term monthly debt.) For example, to qualify for a loan, lenders may require ratios of 28% or 36% of your gross monthly income. This means you can spend up to 28% of your gross monthly income on a mortgage payment, and no more than 36% of your gross monthly income on all other forms of debt, mortgage included.

We work with a number of lenders and would be happy to recommend the right one for you. Click here to contact us today. We are happy to help!

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Contact Information

Photo of J.S. Realty Real Estate
J.S. Realty
J.S. Realty, LLC
5112 Midway Rd
Duluth MN 55811
Office: (218)729-9784
Fax: (218) 729-5638