Guardians of Grail

cheapbag214s · Posted: Fri 9:44, 22 Nov 2013 Post subject: before taxes

How Much House Can You Afford?
Are you looking to take advantage of the historically low mortgage rates and get yourself into a new home? Before you make an offer, you’ll want be sure to get your financing in place and know how much you can afford. Guardian Mortgage Company Offers Free Handbook forThoughtful HomebuyersAre you looking to take advantage of the historically low mortgage rates andget yourself into a new home? Before you make an offer, you’ll want be sure toget your financing in place and know how much you can afford. Guardian MortgageCompany has a free 40-page handbook for homebuyers to help them navigate allthe different rules and options for their mortgages. This excerpt from page 14 covers questionsyou should ask when determining how much house you can afford:Howmuch do you pay now for housing (either rent or a mortgage)? If you are struggling to make the housing paymenteach month, then your new housing payment should be less than what you arecurrently paying. If you have little debt and can easily make your housingpayment, then stepping up to a bigger housing payment makes sense.HousingRatio – the total home payment(principal,[url=http://www.pradahandbagsoutleti.com/Prada-Shoes-1/Prada-Women-13/Prada-Totes-15/]Prada Tote Bags[/url], interest, property taxes and homeowners insurance) divided bymonthly gross (before taxes) income gives a number that represents what percentof your monthly income is being used toward housingTotalDebt-To-Income (DTI) Ratio – thetotal home payment plus other installment loan payments,[url=http://www.pradahandbagsoutleti.com/Prada-Shoes-1/Womens-Prada-Cup-Shoes-10/]Prada Shoes Women[/url], minimum payments to revolvingcredit accounts, and any child support or alimony payments divided by monthlygross (before taxes) income gives a number that represents what percent of yourmonthly income is “obligated” toward total debtThe oldrule of thumb used to be that if you kept these ratios to the followingguidelines, you could qualify for the home loan:·Housing Ratio –should be no more than 28% of your monthly gross income ·DTI Ratio –should be no more than 36% of your monthly gross income These old guidelines have become mostly obsolete withthe introduction of automated underwriting systems. These are software programs thatanalyze a borrower’s ability to repay the loan given the borrower’s credithistory, income, current debts, andloan-to-value of the new loan; however, common sense can still override an automated outcome.With theintroduction of automated underwriting systems, borrowers can now qualify forloans where their Housing and DTI ratios are greater than these old rules; however,the borrower’s credit score and amount of money in the bank significantlyaffect the maximum ratio for each borrower. A good budgetfor even the person with superior credit should not be more than 45% of grossincome for total debt payments. This leaves the rest of the money to pay incometaxes, Social Security taxes, savings, retirement investments, home repairs,utilities, food, clothing, medical bills, vacations, college tuition, etc.For more information covering the entireprocess of buying a home, “like” us on our facebook fanpage and get a FREE35-page Homebuyers Handbook (www.facebook.com/GuardianMortgageCompany). If you are a homebuyer in North Texas(972-248-4663) or Central Michigan (810-694-8610), please feel free to contactus for a free consultation on your particular lending needs. Ready to getpre-approved? Click HERE for ouronline application form (http://bit.ly/GuardianApplication).