Mortgage Myth # 5 Only your Income Determines How Much you can Borrow
The Amount of income a potential borrower makes is absolutely important, but it is not the only factor in determining how much they might be able to borrow. One of the most frequently asked questions in the mortgage business is about how do I qualify with a $ 100,000 yearly income.
Many times, a year I get a potential home buying saying a make a $ 100,000 a year how come I cannot buy a more expensive home. The simple reason is their outstanding debt.
Debts, such as student loans, car loans, revolving credit card debt with help determine what amount of mortgage you will qualify for. Lenders use DTI ratio’s, Debt to income, to determine what you qualify for. The more debts you have monthly the less of a home you might be able to qualify for. TO help you better understand use our Debt to Income Ratio Calculator to help determine what mortgage amount you might qualify for.
Remember that income is just one of the 3 important factors when determining what mortgage and type of mortgage you might qualify for. You must also take into consideration what your credit scores are and your down-payment.
Should you need help to review what your options might be please do not hesitate to call us at 631 589 3600.