How Much Home Can You Afford

Your cash saving, monthly income, and credit record all factor into how much you can afford to spend on a home This information is important to lenders as well as to you. www.home-mortgage-loans.biz can help!

DOWN PAYMENT

The down payment is the the amount of the purchase price you pay for in cash.
More cash, smaller loan. The more cash you put down, the smaller your loan will be. So if you have a lot cash but a low monthly income, you can make a large down payment, borrow less, and have smaller monthly payments.
Less cas, larger loan. On the other hand, if you have little cash but a high monthly income, you can buy a home with a small down payment and have a large loan.
CASH

Where will you get the cash? Here are some of many possibilities:

* Cash in the bank;
* Saving and investments you can afford to sell;
* Valuables you wouldn’t mind selling (it’s like exchanging them for a bigger valuable, such as a home);
* Many 401(k) and other retitement plans allow you to borrow from your account to raise cash;
* Gifts or loans from friends or relatives;
* Grant from non-profit groups.

MORTGAGE

The mortgage is your loan. Of course, the larger the loan your monthly payments. Each payment is actually two payment written as one check.
Principal. Aportion of each payment repays the amount you borrowed.
Interest. The remainder of each payment goes to pay the interest on the loan.
MONTHLY PAYMENTS

How large could your monthly mortgage payment be?
Monthly income. Add up all regular and recurring income that can be documented. Beyond income from work, include ongoing income from real estate, stocks and bonds, royalties, annual bonuses, and unearned sources of income such as alimony. Use a 12-month figure and divide it by 12 to get the monthly amount.
Monthly debt. Subtract from the total income the amount you pay in fixed debt, such as car loans, student loans, and divorce payments. You don’t have include a debt that will paid of within six months. Credit card debt, unless very high, can be excluded, too.