Here is a pretty neat way to find out how much you (or your client) will be able to qualify for, and how much you can afford to purchase.
Take your down payment (Minimum of 5%) and add that to what you qualify for in mortgage financing. (See below)
How much will I qualify for based on my income?
- For every $10,000 a year in income you earn you qualify for about $50,000 in mortgage financing (Monthly debt payments will reduce what you qualify for)
How will my debts effect the amount I qualify for?
- The first $400 a month in debt payments that you have, don’t reduce what you qualify for
- after the first $400 every $350 a month in debt payments will reduce your mortgage qualifying amount by about $50,000
Note: * Monthly debt payments have the highest impact on qualifying
i.e.
$350 a month in debt payments = $50,000 less in mortgaging
or
$350 a month in debt payments = $10,000 a year in income to offset
$350 a month in debt payments = $50,000 less in mortgaging
or
$350 a month in debt payments = $10,000 a year in income to offset
How much will my mortgage payment be?
- For every $100,000 in financing you have it will cost you about $500 a month ($490 to $520 based on todays rates)
And to be totally sure, contact me at 519-217-3484 or geoff@getmortgaging.com
