How much home can you afford in Chandler, Arizona?

By
Real Estate Agent with Good Company Real Estate www.ChandlerRealEstate.weebly.com License # SA577557000
How much home can you really afford in Chandler Arizona?

When it comes to buying a home in Chandler, and figuring out how much you can afford, there are a lot more factors than just how much money you make.  There are factors such as credit score, credit history, and available cash that will also determine how much home you can, or should buy.  Everyone knows that qualifying for a loan these days is much more difficult than four years ago, and to some extent, that is a good thing.  At the same time, if you are in the market to buy, here are some things you should be aware of given today's current lending environment.

Credit Score - The lower your credit score, the higher your interest rate will be when qualifying for a loan.  If your credit score is too low, you will not even qualify for a loan.  To qualify for an FHA loan, most lenders will require you to have a credit score between 620 and 660.  For a conventional loan, your credit score needs to be above 680, and preferably over 720.  The higher interest rate you pay on your loan, the less of a home you can buy, so having a good credit score can help you buy more with your money.

Credit History - Along with your credit score, lenders will look at your credit history.  This includes the number of revolving accounts you have, the balance on those accounts, and how much you pay each month on these accounts.  These revolving accounts include all credit cards where you carry a balance each month.  This also includes other things like car loans, student loans, and any other monthly debt payments you make, including rent or a current mortgage.  It is critical to maintain a low balance on any of these accounts if at all possible and make sure to pay these bills on time.  You also must not have too many of these accounts, as any payment on them is going to reduce the amount of money you can apply towards a new mortgage payment, and you won't be able to buy as much home.

Cash - Another factor to determine how much home you can afford is the amount of cash you have to apply towards closing costs, and/or a down payment.  You can get a lower interest rate by putting a larger down payment on a home, and if it is more than 20%, you will avoid paying Private Mortgage Insurance (PMI).  You can also pay for closing costs, which will reduce the overall loan amount.  You can also buy down the interest rate if you have cash, which will reduce the monthly mortgage payment, and allow you to buy more home.

If buying a condominium, townhouse, or single family home in a cummunity with a homeowner's association, those monthly fees will also reduce the total amount you can afford on your monthly mortgage payment.  If you own your own business, how much income you declare on your tax return is what will determine how much home your lender feels you can afford.  Stated income loans have pretty much gone away, and lenders want to see at least two year's of tax returns for your business, a profit and loss statement for the current year, as well as other documents.

One final thing to remember is that you don't need to accept how much the lender says you can afford when it comes to buying a home.  You need to make sure you are comfortable with the loan amount and the monthly payments.  So, how much home can you afford to buy in Chandler depends on your income, credit score and credit history, the amount of cash you have, and how much you are comfortable spending.
Posted by

         Contact Troy Erickson, Realtor®, Good Company Real Estate

                                Licensed Residential Realtor® in Arizona at 602-295-6807

                  for Phoenix, Chandler, Ahwatukee, Tempe, and Gilbert, Arizona Real Estate.

 

Check out our website for all Arizona Real Estate and Homes For Sale in subdivisions like Sun Lakes, Ocotillo, Lakewood, Mountain Park Ranch, Pepperwood, Circle G Ranches, and many others throughout the East Valley.

 

"Real Estate is more than just about a job for me. It is about making a difference in the lives of others. I help people just like you Buy, Sell, and Invest in East Valley Arizona Real Estate!"

        Follow me icon for Twitter        View Troy Erickson's profile on LinkedIn      Troy Erickson Realtor      Troy Erickson on Zillow

***********************************************************************************

Subscribe to my Blog via Email by entering Your Email address here:

Delivered by FeedBurner

 ***********************************************************************************

This post is for informational purposes only and should not be construed as legal advice. If you desire specific legal or tax advice, please consult the appropriate professional. The opinions expressed here represent my own and not those of my employer. Troy Erickson will not be held liable for any errors, ommissions, accuracy, validity, currentness, suitability, completeness; or any losses, injuries or damages arising from its display or use.

close

This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At
Topic:
Home Buying
Location:
Arizona Maricopa County Chandler
Groups:
1st Time Buyers
Arizona Real Estate
First Time Homebuyer
Local Expert
Posts to Localism
Tags:
home affordibility in chandler arizona
buying a home in chandler
home buying in chandler arizona

Spam prevention

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?

Rainmaker
830,734

Troy Erickson AZ Realtor (602) 295-6807

Your Chandler, Ahwatukee, and East Valley Realtor
How can I help you buy or sell your home?
*
*
*
*

Additional Information