One of the first things you should do if you’re considering a home purchase is to find out how much you can afford. Keep in mind, a lender will tell you how much your maximum is. In most cases, I would suggest buying based on what you need and not what you can afford.
In the financial planning world, the general recommendation is to limit your housing ratio 1 to 28%. Housing ratio 1 is housing expenses ([PITI + HOA/condo fees]/gross pay). For example, if your household income is $120,000/yr($10,000/month), you would want to keep your house payment under $2,800/month.
You may also want to consider housing ratio 2. The general recommendation is to keep this under 36%. This is the total of housing expenses plus any installment payments (credit cards, auto loans, student loans) divided by gross pay. Continuing with the example above, if you had a household income of $120,000 ($10,000/month), you’d want to keep your total debt payments under $3,600.
If you have no debt, then you may be comfortable with an allocation of 36% of gross pay to housing. However, buy what you need. It’s nice to have some margin at the end of the month.
Here are some loan officers you can contact for rates/fees.
Sylvia Bae | Senior Loan Officer
M 571-251-9854 F 571-303-0166
E sbae@fhmtg.com W www.baeteam.com
A 3201 Jermantown Rd, Suite 800 | Fairfax, VA 22030
Shane Lee
Sr. Mortgage Banker
NMLS ID#: 1898832
Cell: (703) 899-8876
Email: shane@apexhomeloans.com
Anna Tapparo (First Savings)
NMLS #1901330
240-223-1638 Phone
703-564-1769 Fax
atapparo@firstsavings.com
6550 Rock Spring Drive Suite 300
Bethesda, MD 20817
Alexanne Yi (fluent in Korean and English)
Mortgage Banking Consultant | First National Bank
(571) 278-3503
4114 Legato Road, Suite 450
Fairfax, VA 22033
Ian Waite
iwaite@cmgfi.com
www.ianwaite.com
(571) 393-9024
Nilesh Makhija
Sr. Loan Officer
Buckingham Mortgage, LLC
1593 Spring Hill Rd., Suite 100, Vienna, VA 22182
(973) 234-9113
nilesh@bfgusa.com
NMLS #2085698