There are few things more exciting than finding your ideal home, but with the rising cost of housing, a person’s dream home can often come with a very high purchase price. If you’re wondering how much home you can truly afford and how your cost of living will fare for your mortgage approval, here are some of the details on what you can expect when it comes to finding a home at an affordable price.
What Is Your Debt-to-Income Ratio?
Before deciding if a home is right for you, it’s important to calculate what your debt-to-income (DTI) ratio is to determine how much house you can afford. The debt amount will include any credit cards, existing mortgages and other loan payments that you pay down each month. To determine your maximum monthly payment, multiply your gross income by 0.36 and divide it by 12. This will give you the expenditure of debt, including your housing payment, that you should not exceed each month.
Determining Your Down Payment
There’s a lot of talk around the ideal amount you should put forward for a down payment, but this percentage can directly impact the amount of the house you can afford. If you are able to put down 20% of the purchase price of your home, this means your monthly mortgage payments will be minimized and this will decrease your DTI ratio. While a home may be out of your reach if you can only put 10 or 15% down, 20% down will ensure a higher amount of disposable income on a monthly basis, making your application more feasible.
Determine Your Lifestyle
While a lender may not reject your application outright if your debt-to-income ratio is higher than suggested, it’s important to know what kind of spending choices make sense for you so that you can make your monthly payments. If you have limited expenses above your mortgage and enjoy a Spartan lifestyle, it’s entirely possible that you’ll be able to manage a higher monthly amount. However, if you don’t have stable employment and are struggling each month, it may be a good idea to consider a less expensive property.
The monthly mortgage payment for your dream home may look like it’s manageable on the surface, but if your DTI ratio exceeds what is suggested, there may be issues with acceptance of your application. If you’re currently in the market for a new home, give me a call for more information – J.P. Cook – 602-320-4253.
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3336 S 155th Lane
Goodyear, AZ 85338
$462,490
4
Beds
2
Baths
1,797
SqFt
Status
Active
MLS #
6692746
Property Type
Single Family Residence
Price Type
--
Below Market Financing Available!!!!!!!!! This single-level home showcases a spacious open floorplan shared between the Great Room, kitchen and dining room, with access to the covered patio for outdoor lounging and entertaining. The owner's suite enjoys a private location at the back of the home, complemented by an en-suite bathroom and walk-in closet. Three additional secondary bedrooms are comfortable and private retreats for household members and overnight guests. Photos are renderings of a model home, not the actual home.
17913 W Addie Lane
Surprise, AZ 85374
$462,000
2
Beds
2
Baths
2,302
SqFt
Status
Active
MLS #
6644538
Property Type
Single Family Residence
Price Type
--
NEW ROOF, NEW CARPET, Fully Paid Solar and so much more (See Supplement for additional Comments) makes this 3-bed, 2-bath, and AZ Room in the 55+ guard-gated & golf course Community of Arizona Traditions the one for you! 2-car garage, desert front yard with a front patio that includes a decorative Table and Benches. The kitchen has ample cabinets, Stainless Steel Appliances, center island, and dining area w/bay window. The owners' suite is spacious! Owners' Bath consists of a walk-in closet, storage cabinets, Tub, shower, and dual sinks. Enjoy the Beautifully enclosed heated & cooled Arizona Room. The Landscaping Water System uses PVC. A feature you can't ignore is fully paid solar with electric bills avg. $20 per month. BRAND NEW ROOF - Installed December 2023, Exterior Paint 2015. Other features that benefit the buyer include - AC Unit 2014, Mini Split 2019. BBQ -2021, New Carpet - December 2023, Wood Floor - 2017, Dishwasher - 2018, Microwave - 2020, Stove - 2018.
15715 N 168th Avenue
Surprise, AZ 85388
$462,000
4
Beds
2
Baths
2,166
SqFt
Status
Active
MLS #
6662476
Property Type
Single Family Residence
Price Type
--
Nicely appointed home in the attractive Surprise community of Surprise Farms. 4 bedrooms, 2 bathrooms, with a sought after kitchen greatroom open concept along with a separate formal living and dining room. Light and bright kitchen comes with corian countertops, stainless appliances, large island with sink, and upgraded white cabinets. Master bedroom has a large walk-in closet, double sinks, step-in shower, soaking tub, and private toilet room. The 3 other bedrooms are generously sized and all have a dedicated closet. Convenient location to neighborhood parks, shopping, dining, entertainment, and all the amenities that up and coming Surprise has to offer. VA loan is assumable to Veterans, Non-Veterans, and Investors! $2692 Monthly, 5% Interest Rate, $443,562 Balance as of 4/10.
5432 W Beverly Road
Laveen, AZ 85339
$462,000
3
Beds
2.5
Baths
2,170
SqFt
Status
Active
MLS #
6670221
Property Type
Single Family Residence
Price Type
--
AZ Resort Living at its Best! This gorgeous 3 bedrm, 2.5 bathrm, 2 car garage home is in the heart of Laveen (202 corridor). Newly painted interior,exterior & garage floor! Beautiful tile floors & new carpet T/O! Open floor plan makes for an entertainer's paradise. Kitchen has new quartz countertops,lowered counter/breakfast bar,new undermount stainless sink,new dishwasher,upgraded cabinetry. Some new lighting fixtures. Ground floor ensuite primary bedroom w/spa bathroom:separate shower,Garden tub & huge walk-in closet. Stepping outside onto the newly painted patio floor,bordered grass area ready for your personal touch,room for a pool! Located just moments away from shopping,dining, beautiful,parks & 202 freeway access (202 corridor). Easy access to Downtown Phoenix & Surrounding areas.
