Understanding Your Mortgage Payments ~ Newburgh NY
Understanding What You Can Afford When Buying a Home
John has the info here about how you could be fooled into thinking a higher priced home is for you. When the bank tells you what you can qualify for and what you want to pay monthly can be two different numbers. As a buyer finding out the real numbers is important for buying the right home. Look to your Realtor to guide you. John explains this quite well in this post. It applies anyone pursuing a mortgage... no matter what part of the country you live in.
I was having a conversation the other day with a potential buyer and the discussion turned to the loan process, financing and affordability. So how much house can I afford was the question and as I navigated through that with my finance calculator I could see we were not seeing eye to eye on the payment numbers. After some questioning they shared that they had been using an online mortgage calculator. They had made their determination of affordability based on that calculator.
Unfortunately most online calculators fail to figure Hazard Insurance, Property Taxes andMortgage Insurance plus this buyers interest rate was going to be bit higher than the calculator had suggested due to income and credit items. Obviously there was a substantial gap between what they had thought a payment was going to be verses the actual payment.
If you're asking yourself How much house can I afford consider contacting your local Realtor® for a more accurate analysis of what a payment might look including the principal, interest, taxes and insurance (PITI ). If you are not applying 20% of the purchase price as down payment there is a good chance you will have mortgage insurance added to your payment. Your local Realtor® can also make some excellent suggestions for a local professional lender that can find the mortgage solution that is best for your needs.
Mortgage calculators are fine but most often do not include insurance, taxes and mortgage insurance. Talk to a professional so you know exactly where you stand. There is nothing more frustrating than finding your dream home only to learn its out of your financial reach.
If you are in the Albuquerque area and considering the purchase of a new home please give me a call so we can discuss your real estate goals and dreams as well as financing options and affordability. I would welcome the opportunity to serve as your Albuquerque Realtor®.Albuquerque Homes and Lifestyle Blog
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John McCormack Owner/Managing Broker, e-PRO
505-980-4576 / John@AlbuquerqueHomes.com
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If your considering Buying, Selling or Relocating to Albuquerque or Rio Rancho, NM and need a Professional Realtor It would be my pleasure to help you!
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