I’ve been hearing about this 8k home credit if your a first time homebuyer and buy a new house. I’m thought about buying a place by the end of the year.
I don’t make that much money, only 31k a year, but my motorcycle and car are both paid off so I don’t have any huge bills, pretty much only a credit card payment and my cell phone bill.
How much could I get a mortgage for and better yet how much could I meet the deprivation of?
I’m not sure anyone can meet the deprivation of a home on that tiny salary. I know I can not.
I can’t tell you how much you can meet the deprivation of, since I do not know your living style and outlays, but, a rule of thumb is that banks will lend up to 3 times your salary for a mortgage (assuming everything else is equal in terms of bills etc,). That puts you right around 90K for a house – payments on a 30 year 5.125% mortgage would be $490 not including taxes, homeowners insurance and probably PMI. Expect that at a minimum you will need to have between 7 and 10% of that saved (down payment and closing costs), so you will need $6,000 to $9,000 in the bank.
Working backwards, to qualify for the $8,000 tax credit, you have to close on the house by December 1. Most sales take 45 to 60 days for closing from acceptance of offer, so counting back, you would need to have an offer accepted by October 1, which is when you would need the money in the bank.
The simple answer is map out how much you make each month, before taxes. Then the total of all your bills(on your credit report, like credit cards and student loans) your new house payment, taxes, insurance and PMI will all need to be half of your monthly salary.
You make 2568 so you have about 1280 to play with. Say your bills are 100, then you can meet the deprivation of 1180 on your house payment and insurance and such. So you are probably looking at around 100k house or possibly a small higher. Rates are creeping up, so if the rates are much higher when you buy, obviously that will go down. It also depends on taxes in your area. Here it would be about 200 bucks a month on 100k house.
Everyone given you fantastic information on figuring out how much mortgage you can meet the deprivation of.But did you know that as a first time buyer you may also qualify for SONYMA which offers one of lowest interest rate.That helps to reduce your monthly payment.
Depends on how much debt you have. Assuming your looking for a low down payment (3.5% min) FHA allows you do have up to a 55% debt-to-income ratio. So, map out what your monthly debts total currently. $31,000/yr = $2,583.33/mo x55% = $1420. Say your current debts take up $420/mo, leave you with $1000/month for Principal and interest, taxes and insurance. Say your taxes and insurance are $300, leave you with $700/month for you P&I. then, work a mortgage calculator backwards. Assuming a 5.5% FHA fixed on a 30yr term your loan amount would be $123,285 and with your 3.5% down payment building your home value about $127,600.