How much you can afford to pay for your new home? How much you can afford depends on your income, credit rating, current monthly expenses, your down payment, and the current interest rates. Use the Mortgage Payment Calculator below to estimate your monthly payment and then contact a lender to get pre-qualified. A lender will review your credit history and finances and then recommend a loan program that best suits your personal situation. Home loans are not one size fits all. What works well for one borrower may not be suitable for another.
Your lender will tell you the maximum amount you will qualify for and provide you with a pre-qualification letter to include with your offer to purchase your new home. You should use this amount to set the top end of the price range when searching for your home. This will prevent you from falling in love with a home that exceeds the limit the lender has approved for your loan. In addition, presenting a seller with an offer that does not include a pre-qualification letter from a financial institution will most likely not be accepted. Seller’s want some assurance that you have the ability to complete the purchase before entering into a contract. Once a contract is in place the home is no longer available to other buyers so seller’s are understandably reluctant to accept an offer from an unqualified buyer.
Just curious what your payment would be for various home prices? Use the Mortgage Payment Calculator to see how your potential mortgage payment compares to your current rent payment. You may be pleasantly surprised and find that you could own your own home for less than you are currently paying for rent.