Calculating Affordability

How much can I afford?

Deciding how much house you can afford is a personal decision, and many factors come into play. How much can I borrow?  How much can I put toward my down payment?  What size monthly payment can I afford? 

There are no black and white answers to these questions - it's a matter of give and take.  If you plan on a 30 year mortgage, you can probably make a lower down payment (or perhaps no down payment at all) and still manage the monthly payments.  If, on the other hand, you plan on a 15 year mortgage, you'll probably want to make a larger down payment to keep your monthly payments in line with what you can afford.

How large of a down payment can I make?

Many buyers look at their cash on hand as their only source for their down payment, but there are other opportunities to fund the initial payment for your home.  A common way to fund (or partially fund) a down payment is by using a gift. Parents, grandparents and other family members are often eager to help by making a cash gift toward the purchase of your home.  

There are also down payment assistance charities that can help you.  And, of course, if you are selling a home, the equity you've built up can be applied to your down payment. But these are not your only options. We can help you explore all your down payment options, including low down payment and 100% mortgage financing options that might be right for you.

What size monthly payment can I afford?

When determining what size monthly payment you can afford, you'll want to consider what other monthly expenses you have. Tangible expenses such as car payments, day care, and utility bills all play a role in how large a monthly payment you can afford.

There are also the intangible expenses or lifestyle expenses that you'll want to consider.  Things such as dining out, travel, and when you buy your next car can affect how much you can afford. Are you willing to curtail or delay some of these expenses in order to afford a larger monthly payment?

How much can I borrow?

This is a question you'll want to get answered before you begin your home search, and it's something we're here to help you with.  Our mortgage calculators will help you see how your down payment, monthly payment, and the amount you borrow are all interrelated.