Want to know how much you will qualify for on your mortgage? Read more...
Qualifying for the Mortgage
There are two basic guidelines that lenders use to determine what size mortgage you are eligible for:
Your monthly mortgage payment of principal, interest, taxes and insurance (PITI) should not exceed 25 to 28% of your monthly gross income.
Your monthly housing cost (PITI) plus other long-term debt should not exceed 33 to 38% of your monthly gross income.
If you max the above numbers out...you may or may not be eating rice for a very long time.
That's it in a nutshell!
*DANGER Read on with CAUTION...
Okay, so you don't qualify for the house you are looking for. I don't recommend you spend more than what is indicated above - but there are programs and ways to qualify for a higher loan (ask your mortgage broker about these programs).
Again, I STRONGLY recommend that you do not over-extend yourself. But if you know 100% that you are winning the lottery this Saturday - then by all means ask your mortgage broker about how to qualify for a larger loan.
Sincerely,
Chantal Gakwaya
(407) 346-5331
Orlando Real Estate