Set aside 2%–5% of the home price for fees; don't use this money for the down payment.
Standard for many first-time buyer conventional loans.
Result in higher rates, which raises your monthly payment and lowers the total house price you can afford. 🧮 How to Calculate Your Power To get a realistic number, follow these steps: Step 1: Determine Monthly Income Take your annual salary and divide by 12. Example: $100,000 / 12 = $8,333/month Step 2: Apply the DTI Limit calculate home buying power
Your monthly mortgage payment (principal, interest, taxes, insurance) should not exceed 28% of your gross monthly income.
To help you get a more accurate number, I can run specific calculations if you'd like to share: Your ? Your total monthly debt payments ? How much you have saved for a down payment ? Your approximate credit score range? Set aside 2%–5% of the home price for
Your total monthly debt payments (mortgage + car loans + student loans + credit cards) should not exceed 36% of your gross monthly income. 2. Down Payment Amount 3.5%: Minimum for FHA loans.
The "gold standard" to avoid Private Mortgage Insurance (PMI). 3. Credit Score & Interest Rates 🧮 How to Calculate Your Power To get
Example: ($8,333 x 0.36) - $400 car payment = Step 3: Factor in "Hidden" Costs