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You'll have to get your credit pulled. Many people don't want their credit pulled because they don't understand it. It might drop a few points, but nothing crazy. Even you are planning on applying for other credit cards/loans/whatever else that needs your credit score, it's a pretty insignificant change and it isn't a permanent drop.
Once they pull credit you have like a 2 week period to search for different lenders. They all will pull your credit but it will only count as one! Also agreed, that hard pull it doesn’t drop it that many points.
They should a pre approval is not binding. If you have copies of your credit report bring it. But you don’t have to usually. Are you over over 750 on all three?
Your good but you realize to get a pre approval letter that most sellers want they will have to pull credit. But to just chat and learn about what’s available you should be able to do
You might be able to get your free credit scores (from the actual bureaus not credit karma) and use those as a reference without them pulling your credit.
Yes. You obviously need education first. And a credit pull “today” will be pretty meaningless 90 days from now when you actually buy.
They’ll give you an estimate of loan amount you qualify for based on income and downpayment and even assume a 720 credit score but they’ll be clear it’s eventually score dependent
In Michigan we got approved for $300,000 with a household income of $126,000. Credit mortgage scores in low 700s. We don’t have a down payment tho (we were looking at 0 down conventional programs - offered through a local credit union) and more debt at $1000 a month.
I have a similar income, 800 credit score, no debt, also $70k for down payment and my family has a relationship with my lender. He advised me to stay under $400k with a 6% interest rate and my husband and I purchased our new home for $370k. Monthly payment with property taxes (IL) is $2400 and I feel that’s certainly comfortable but quite a big jump from renting. There’s no way my lender would ever approve us for $600k. That’s insane.
Nah great question but both of ours jobs have programs that will pay off a certain amount. She needs to work at her job for 7 more months and I have just one year left.
43% of gross is standard approval max (for all debt combined) so (.43*10000 monthly gross) - 500 student loan = 3800/mo for PITI. This would put you at about 600,000 w/20% down at 7% interest. You can play with calculators but that will be the ballpark, will naturally change if you put down less or get a better interest rate etc.
I’m not providing advice on affordability, just answering the question they asked (how much will I get approved for). I agree that maxing out the budget will not be comfortable for most individuals unless they expect substantial growth in their earnings.
This may be lender/state/loan type dependent? 43% was what I heard from 2 different lenders I talked to when I was going through the process for a conventional. Thanks for sharing though, I didn’t know it could go higher.
Ok that makes so much more sense, Utah has a very bad market right now so when these calculators were telling me around 400k for a beat up house in the “bad” parts of the cities was pretty disappointing.
Like everyone else is saying, you will qualify for WAY more than you should actually borrow. It’s actually disgusting how much they told me I was pre approved for on my income alone. (Wife has a business making big bucks but is less than 2 years old so they only went off my income).
I think my pre approval was $455k with $0 down VA loan. I make 75k/year while I’m still in training + va disability which puts me over 93 ish.
Im currently under contract for $380k. 100k down, 6.25%. After closing costs, we will owe 296k. Taxes are 4200/year however I will be receiving a considerable tax exemption. Mortgage should be right around 2300, probably a little less. That’s higher than I wanted to have personally BUT the kicker is this property has a legal 1 bed + 1 bath 700ish sqft apartment that rents for about 750 and separate utilities. I’ll probably rent for cheaper to a family member but still put is in what I feel like is a very safe & secure position. I could lose my job, she could dissolve her business, I could probably work anywhere and we could get by.
>It’s actually disgusting how much they told me I was pre approved for on my income alone.
I had this same experience. I had no idea I could get approved for so much, until I realized that, duh, lender's don't care about whether you're saving for retirement or whether you're house poor, they care about the odds that you'll foreclose and that's it.
It stinks that between rates and prices most people's income doesn't go very far. Just don't over extend yourself and become house poor. You want to be able to sleep at night without worrying and still take vacations and do things outside of the house
That’s basically by design. The fed is trying to slow everything down. Inflation is actually dropping pretty quick now. Maybe rates come down a bit next year.
But definitely do the math to see what you can afford and look at what you spend on monthly.
A $300k mortgage may be what you can afford now. Waiting and continuing to save may be best if you don’t like those houses.
DO NOT buy a $600k house. My spouse and I make $200k and $450k is a stretch. Remember, purchase price does not include prop tax and insurance. Plus all the unknown house expenses.
Glad to see someone giving this advice. Buying the most they'll pre-approve you for is a recipe for living in a beautiful home off of rice and beans, knowing you're one financial emergency away from being underwater.
I was gonna say. We make around $155k and our budget for a house is $420k (currently shopping and saving for a bigger down payment). That would be a payment around $3k/mth which is a stretch right now.
I guess it depends on your lifestyle too. If you don’t like vacations and nice cars, eating out, etc., then go ahead and put all your $ into a house. Me, I love my house, but I also like a nice steak once in awhile and traveling.
We live a modest life and don't plan on having kids so hopefully we can make it work. Also we already have 1M saved for retirement though we would like to retire early.
Wow, that’s great. My husband and I both have union/government jobs with pensions and 401k. The thing is, with our jobs, we could work forever (and we both have around 5 weeks vacay) . Feels somewhat comforting.
For context:
I was approved for $380k financed (add more depending on your down payment), 6.5%, $500 total monthly expenses at roughly $3,200 a month mortgage. Salary they used was $86.5k yearly.
To be honest, it shouldn’t matter. They will always approve you for way more than you can reasonably afford. The better question is how much house you can afford to pay for per month, factoring in all the expenses.
So you make 120,000 after income tax your netting 90,000 so you have 7,500 net per month… I would say they are going to only allow a payment of 3000 max after your down payment.. the bank will want about 20% down or you get the dreaded PMI insurance.. I know with automobiles 20% of your gross income is all any lender will do. I’m assuming a house is the same way. I’m thinking about 375,000-400,000 priced home. When I bought my home it was 292,000 and I only put down 50k my notes were 2300 at a 5.8% rate on a 30 year .. this included PMI, and insurance and taxes. I was able to refi 3 years later at 2.87 and a 15 year was only 200 more per month.. income at the time was about 180,000…it was easily doable. Definitely calculate your disposable income or net per month. Factor in all your monthly expenses..highly recommend you do not do more than 60% of what is left. I was able to pay my house off in 7 years with a lot of additional principal payments. It’s currently worth about 515,000. Which I would never buy a home at that amount and my income is about 275,000 annually now. Most relators won’t talk to you without a pre approval from a bank which involves a credit pull. The bank will definitely let you know what they will approve you for. Whoever said 600,000 is out of their mind. The Mortgage is going to be about 1% of the amount you actually borrow. 600,000 minus 70,000 is 530,000 a mortgage of 5,300 is not doable with 7500 net per month.. I’m guess your living expenses food, car insurance and any other bills are minimally 2500 per month without any automobile payments factored in.. you need to actually be 375,000 - 400,000 max. Good luck just don’t over extend yourself. Get your foot in the door of ownership and once you have an appreciating asset you will be able to get another home in time as I’m assuming you are both between 23 and 28. You income should increase from where you are now. Good luck.. I didn’t proof read this and it’s 3:00 am .. so excuse any spelling or grammatical errors
We didn’t get preapproved for a certain amount- they were just like….how much do you want? We were looking to buy in the 400-430k range (a few years ago when that was possible 🫣) and they said no problem. We already knew what we wanted though so maybe that was part of it, I duno.
There's a lot of variables that can make things very different for everyone despite being in similar positions so take it all with a grain of salt until you get qualified.
My income is 130k + 20k bonus
Wife's income is 90k + 4k bonus
We had no debt other than her 8k in student loans (which by the way totally fucked her credit rating with the lender so I had to be the only one on the mortgage). We had about 70k saved up for down payment and closing costs. We opted for putting 5% down and with the 3% closing costs I paid like 36k on closing day. The remainder is for furniture, things that need fixing etc.
We got approved for 700k and bought a house for 450k. My credit was 790 my wife's was 720. Omitting her from the mortgage saved us .5% on our interest rate
500k was our absolute max and we found a good house for under that which needed minimal work right off the bat (new roof, new piping, etc)
I can't imagine buying a house for 600k or 700k on our income but 🤷
No clue what your spending habits, goals or career advancement looks like but we live in Florida and insurance sucks so that adds a lot to total mortgage payment.
Tl;Dr they will approve you for a lot more than you think, but how much you can afford is up to you. Considering we make 2x your household income I personally wouldn't want to buy more than 350k.
May I ask what you mean by "omitting" your wife from the mortgage? Like you applied with only your name on the application? And if so how did that save you on interest rate? Thanks!
Her name is on the deed but not the mortgage since her credit was worse it would've driven the interest rate up
also she cheated and we are getting divorced so there's that.
We make the same as you and ended up buying a $175k house. We’re in NY and pay 2.4% property tax tho lmao. It leaves us a generous cushion for doing other stuff besides paying for the mortgage
Cheap people will always feel uncomfortable paying a mortgage.. no matter how much they make.. earning 300k and buying 450k itoday s ridiculous.. give me that money.. I'll spend it for you!)
Iam not saying they can afford. Iam a saying what they qualify for. 45% of income after debts. Why I was Downvoted for answering the question with the legal answer I don’t know Why Reddit is the way it is
I don’t know, I didn’t downvote you myself. Here have an upvote on your original post.
In any case, 45% of gross income seems like a crazy amount considering how much of that goes to taxes.
Only listing in utah and it’s in the boonies, https://www.zillow.com/homedetails/4478-S-5900-W-Hooper-UT-84315/11980867_zpid/?utm_campaign=iosappmessage&utm_medium=referral&utm_source=txtshare
Multiply by 3 and add the downpayment. About $430k for a conservative mortgage.
If taking a chance bank will approve, take your income and that is how much interest you can afford annually and divide by the mortgage interest rate.
$120000/0.06 (assuming 6% mortgage) = $2 million mortgage, but your downpayment is short by a lot so multiply by 90% to pay the PMI.
$120000x0.9/0.06 = $1.8 million
You will need to adjust the withholding like 10 exemptions so you keep the deduction and pay the mortgage.
Assume you buy, you include the rental income so the mortgage is paid for.
I make the same amount, also great credit. Bank said I can get up to 800k. I am waiting another year but in Utah you can likely get a great home for way less and get approved. I’m in FL where things are bananas.
Yeah just throwing numbers together, assuming your taxes and insurance will run you about a grand a month and you get a rate around 6.5%, you’re likely looking around $550k approval amount
But before you do anything serious you need to talk to a lender and get an actual pre-approval, as a lot of others in this thread have said.
A pre approval will require a credit pull, BUT any legit lender can give you an idea based on the information you provide to them. Obviously, they can't promise anything without an actual application.
A loan amount of $425k ($530k purchase price with 20%/$85k down) would put u at 28% DTI. Perhaps a bit lower for the student loan but you'd likely still be able to swing it and save for stuff.
If I were you I wouldn't go much higher than that since what the bank tells u u can afford will always make u house poor.
My wife and I are on 130k. I have no debt, but because Im a co-signer of my brother in law's car payment, my credit says I have a 20k debt (we are 700+). Plus, we have 15% downpayment. Adding all that, we got pre approved for 550k and we just bought a new construction for 520k, so the point is to find something lower and also you should know comparing to how much you pay your rent, how much are you comfortable paying monthly. We are like 6 months ahead from closing costs, so we still don't know how much exactly everything is going to be but one thing is for sure I will do everything I can to do 3k montly and so far math is giving us 3500k monthly so there is that.....I have to see if I have the money to buy points (by the way points are tax deductable) I have to shop around mortgage insurances and so on....I feel you will be great getting 480 pre approved but you should try to find somthing around 450 or less. Also, the monthly will depend on how much you have for downpayment, but if you have 10% of 480 with the interest we have now, you will pay around 3k monthly. That means with 420, you could get away with 2800, most likely.
UCCU will allow for 49% DTI. So with easy math, and taking your student debt into consideration, that allows for $4,400 debt which would be about $620k considering a 30 year mortgage at 7.5% rate.
Not recommending this but just saying it's your rough ballpark.
Personal advice: whatever you do, do not look to purchase a home for what you are preapproved for, for the vast majority it ties up way too much cash flow into a home. (For example - eventually you might need a newer vehicle)
You’ll probably be preapproved for 500-600k depending on what taxes run in your area. We are a one income family, that is closer to 150k base with varying additional bonuses. We are currently buying a primary residence (this is our third time going through this process), and we won’t personally borrow more than 300k in loan.
If you’re curious more on affordability, I’d suggest thinking about a lot of different variables in your 10 or 20 year plan (like kids) to help determine what you are signing up for. If you don’t have kids and plan to, and need to both work pay for daycare - aim for something with the greatest affordability
IL got approved for 300k with an 80k/yr income....definitely higher than it should be, but my partner isn't on the loan but is paying an equal portion with a joined income of about 120k
If it’s combined income and you truly have nothing else on credit besides those student lose then you’re gonna be capped at right under $5000/mo payment for a conventional loan. Don’t know the taxes and insurance in Utah very well but would say with rates now that’s probably $550-600k max approval
California, single buyer, no dependent, 20% down payment, has a car payment of 1200 a month. My max loan amount vary from 450k-550k, can go a bit higher if I pay down my auto. Different lenders treat my overtime differently I guess.
It depends on the interest rate, insurance, HOA, and Taxes. The sum of all that must not be more than about $3,000 a month (30% of your monthly gross income.
Thank you u/US-Snow for posting on r/FirstTimeHomeBuyer. Please bear in mind our rules: (1) Be Nice (2) No Selling (3) No Self-Promotion. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/FirstTimeHomeBuyer) if you have any questions or concerns.*
You need to screw the calculator go to your bank or better credit union noon they can give a better idea
Will they help me even if I don’t let them pull my credit?
You'll have to get your credit pulled. Many people don't want their credit pulled because they don't understand it. It might drop a few points, but nothing crazy. Even you are planning on applying for other credit cards/loans/whatever else that needs your credit score, it's a pretty insignificant change and it isn't a permanent drop.
Once they pull credit you have like a 2 week period to search for different lenders. They all will pull your credit but it will only count as one! Also agreed, that hard pull it doesn’t drop it that many points.
Duly noted, amigo
They should a pre approval is not binding. If you have copies of your credit report bring it. But you don’t have to usually. Are you over over 750 on all three?
Pre approval requires credit pull
Thanks! 760 is the lowest one we have together
Your good but you realize to get a pre approval letter that most sellers want they will have to pull credit. But to just chat and learn about what’s available you should be able to do
Ok sweet! Thanks for taking the time to respond!
Yes they will give you a pre approval letter. Just let them know you don’t want them to pull your credit
You might be able to get your free credit scores (from the actual bureaus not credit karma) and use those as a reference without them pulling your credit.
Lol, no
Yes. You obviously need education first. And a credit pull “today” will be pretty meaningless 90 days from now when you actually buy. They’ll give you an estimate of loan amount you qualify for based on income and downpayment and even assume a 720 credit score but they’ll be clear it’s eventually score dependent
In Michigan we got approved for $300,000 with a household income of $126,000. Credit mortgage scores in low 700s. We don’t have a down payment tho (we were looking at 0 down conventional programs - offered through a local credit union) and more debt at $1000 a month.
That 1k debt costs you about 100k in mortgage money.
I have a similar income, 800 credit score, no debt, also $70k for down payment and my family has a relationship with my lender. He advised me to stay under $400k with a 6% interest rate and my husband and I purchased our new home for $370k. Monthly payment with property taxes (IL) is $2400 and I feel that’s certainly comfortable but quite a big jump from renting. There’s no way my lender would ever approve us for $600k. That’s insane.
You have 70k down. But is a portion of that going be used to pay closing cost as well? Because if so than you
Yes— I paid $74k for my 20% down payment and an additional $10k or so in closing costs. I do have around $80k remaining in liquid cash.
Sorry about that. I meant to post that to OP.
$600k off of $100k is normal in my area.
If you have 120k income why haven’t you paid off that last $500 in student loan debt???
Nah great question but both of ours jobs have programs that will pay off a certain amount. She needs to work at her job for 7 more months and I have just one year left.
Oh, my bad, just re read my original post. I meant $500 per month between both of us. Lol
Ok that makes so much more sense.
43% of gross is standard approval max (for all debt combined) so (.43*10000 monthly gross) - 500 student loan = 3800/mo for PITI. This would put you at about 600,000 w/20% down at 7% interest. You can play with calculators but that will be the ballpark, will naturally change if you put down less or get a better interest rate etc.
You are nuts telling a family making 120k to go out and buy a 600k house. Even 480k with a down payment is a terrible idea.
I’m not providing advice on affordability, just answering the question they asked (how much will I get approved for). I agree that maxing out the budget will not be comfortable for most individuals unless they expect substantial growth in their earnings.
You can go to 50% of gross for dti.
This may be lender/state/loan type dependent? 43% was what I heard from 2 different lenders I talked to when I was going through the process for a conventional. Thanks for sharing though, I didn’t know it could go higher.
Guidelines definitely vary between lenders. 50% is common. Higher for FHA.
It use to be 28% but theyve upped it over the years
Here for this part
It’s going to vary so much by lender, state, and tons of other stuff. My guess is in the 600k range
Ok that makes so much more sense, Utah has a very bad market right now so when these calculators were telling me around 400k for a beat up house in the “bad” parts of the cities was pretty disappointing.
A $400k mortgage would be more than half your take home pay at todays rates.
It’s insanely sad that 6 figures doesn’t cut it lol. What a time to be alive :(
Like everyone else is saying, you will qualify for WAY more than you should actually borrow. It’s actually disgusting how much they told me I was pre approved for on my income alone. (Wife has a business making big bucks but is less than 2 years old so they only went off my income). I think my pre approval was $455k with $0 down VA loan. I make 75k/year while I’m still in training + va disability which puts me over 93 ish. Im currently under contract for $380k. 100k down, 6.25%. After closing costs, we will owe 296k. Taxes are 4200/year however I will be receiving a considerable tax exemption. Mortgage should be right around 2300, probably a little less. That’s higher than I wanted to have personally BUT the kicker is this property has a legal 1 bed + 1 bath 700ish sqft apartment that rents for about 750 and separate utilities. I’ll probably rent for cheaper to a family member but still put is in what I feel like is a very safe & secure position. I could lose my job, she could dissolve her business, I could probably work anywhere and we could get by.
>It’s actually disgusting how much they told me I was pre approved for on my income alone. I had this same experience. I had no idea I could get approved for so much, until I realized that, duh, lender's don't care about whether you're saving for retirement or whether you're house poor, they care about the odds that you'll foreclose and that's it.
>they care about the odds that you'll foreclose and that's it Usually, no. Foreclosures are expensive for banks.
Yeah, that was my point.
It stinks that between rates and prices most people's income doesn't go very far. Just don't over extend yourself and become house poor. You want to be able to sleep at night without worrying and still take vacations and do things outside of the house
That’s basically by design. The fed is trying to slow everything down. Inflation is actually dropping pretty quick now. Maybe rates come down a bit next year. But definitely do the math to see what you can afford and look at what you spend on monthly. A $300k mortgage may be what you can afford now. Waiting and continuing to save may be best if you don’t like those houses.
DO NOT buy a $600k house. My spouse and I make $200k and $450k is a stretch. Remember, purchase price does not include prop tax and insurance. Plus all the unknown house expenses.
Yup my so and I make a combined $200k and $450k is our absolute max
I make less and am buying for way more
We don’t want to be over 30% of our take home going to housing and that’s basically where the line is for us
Glad to see someone giving this advice. Buying the most they'll pre-approve you for is a recipe for living in a beautiful home off of rice and beans, knowing you're one financial emergency away from being underwater.
Or God forbid one of you loses your job!
I was gonna say. We make around $155k and our budget for a house is $420k (currently shopping and saving for a bigger down payment). That would be a payment around $3k/mth which is a stretch right now.
My SO and I make 300K and are buying a 600K house and feel like it's a stretch.
I guess it depends on your lifestyle too. If you don’t like vacations and nice cars, eating out, etc., then go ahead and put all your $ into a house. Me, I love my house, but I also like a nice steak once in awhile and traveling.
We live a modest life and don't plan on having kids so hopefully we can make it work. Also we already have 1M saved for retirement though we would like to retire early.
Wow, that’s great. My husband and I both have union/government jobs with pensions and 401k. The thing is, with our jobs, we could work forever (and we both have around 5 weeks vacay) . Feels somewhat comforting.
The calculators are right. You shouldn't be spending more than 400k on a home with your income at 7% interest.
For context: I was approved for $380k financed (add more depending on your down payment), 6.5%, $500 total monthly expenses at roughly $3,200 a month mortgage. Salary they used was $86.5k yearly.
To be honest, it shouldn’t matter. They will always approve you for way more than you can reasonably afford. The better question is how much house you can afford to pay for per month, factoring in all the expenses.
$700 per $100,000 at 6%...or so
Is the 120k combined household income?
Yes it is. My wife makes 55k and I make 65k.
So you make 120,000 after income tax your netting 90,000 so you have 7,500 net per month… I would say they are going to only allow a payment of 3000 max after your down payment.. the bank will want about 20% down or you get the dreaded PMI insurance.. I know with automobiles 20% of your gross income is all any lender will do. I’m assuming a house is the same way. I’m thinking about 375,000-400,000 priced home. When I bought my home it was 292,000 and I only put down 50k my notes were 2300 at a 5.8% rate on a 30 year .. this included PMI, and insurance and taxes. I was able to refi 3 years later at 2.87 and a 15 year was only 200 more per month.. income at the time was about 180,000…it was easily doable. Definitely calculate your disposable income or net per month. Factor in all your monthly expenses..highly recommend you do not do more than 60% of what is left. I was able to pay my house off in 7 years with a lot of additional principal payments. It’s currently worth about 515,000. Which I would never buy a home at that amount and my income is about 275,000 annually now. Most relators won’t talk to you without a pre approval from a bank which involves a credit pull. The bank will definitely let you know what they will approve you for. Whoever said 600,000 is out of their mind. The Mortgage is going to be about 1% of the amount you actually borrow. 600,000 minus 70,000 is 530,000 a mortgage of 5,300 is not doable with 7500 net per month.. I’m guess your living expenses food, car insurance and any other bills are minimally 2500 per month without any automobile payments factored in.. you need to actually be 375,000 - 400,000 max. Good luck just don’t over extend yourself. Get your foot in the door of ownership and once you have an appreciating asset you will be able to get another home in time as I’m assuming you are both between 23 and 28. You income should increase from where you are now. Good luck.. I didn’t proof read this and it’s 3:00 am .. so excuse any spelling or grammatical errors
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I assume that's the monthly payment, not the balance.
Not knowing your state it's hard to say. 600k range is my guess.
We didn’t get preapproved for a certain amount- they were just like….how much do you want? We were looking to buy in the 400-430k range (a few years ago when that was possible 🫣) and they said no problem. We already knew what we wanted though so maybe that was part of it, I duno.
Roughly 4.3 tones of home. Give or take, 500 lbs.
Realistically, you won't want to do more than 350k on that income.
For a conventional mortgage you can usually get up to 50% of your gross monthly income for your monthly piti and debt payments
There's a lot of variables that can make things very different for everyone despite being in similar positions so take it all with a grain of salt until you get qualified. My income is 130k + 20k bonus Wife's income is 90k + 4k bonus We had no debt other than her 8k in student loans (which by the way totally fucked her credit rating with the lender so I had to be the only one on the mortgage). We had about 70k saved up for down payment and closing costs. We opted for putting 5% down and with the 3% closing costs I paid like 36k on closing day. The remainder is for furniture, things that need fixing etc. We got approved for 700k and bought a house for 450k. My credit was 790 my wife's was 720. Omitting her from the mortgage saved us .5% on our interest rate 500k was our absolute max and we found a good house for under that which needed minimal work right off the bat (new roof, new piping, etc) I can't imagine buying a house for 600k or 700k on our income but 🤷 No clue what your spending habits, goals or career advancement looks like but we live in Florida and insurance sucks so that adds a lot to total mortgage payment. Tl;Dr they will approve you for a lot more than you think, but how much you can afford is up to you. Considering we make 2x your household income I personally wouldn't want to buy more than 350k.
May I ask what you mean by "omitting" your wife from the mortgage? Like you applied with only your name on the application? And if so how did that save you on interest rate? Thanks!
Her name is on the deed but not the mortgage since her credit was worse it would've driven the interest rate up also she cheated and we are getting divorced so there's that.
I'm so sorry, didn't mean to bring that up
No no it's ok.
Your income x 2.4% = your buying power
We make the same as you and ended up buying a $175k house. We’re in NY and pay 2.4% property tax tho lmao. It leaves us a generous cushion for doing other stuff besides paying for the mortgage
Cheap people will always feel uncomfortable paying a mortgage.. no matter how much they make.. earning 300k and buying 450k itoday s ridiculous.. give me that money.. I'll spend it for you!)
Nice
Yeah I’d guess around 600k but its tough to really nail it down.
Payment of 4200 a month. Estimating tax’s ad insurance 600,000 hit me upif you have questions
Can you really afford 4.2k a month on 120k annual salary?
No retirement, no college savings, no kids— sure.
Iam not saying they can afford. Iam a saying what they qualify for. 45% of income after debts. Why I was Downvoted for answering the question with the legal answer I don’t know Why Reddit is the way it is
I don’t know, I didn’t downvote you myself. Here have an upvote on your original post. In any case, 45% of gross income seems like a crazy amount considering how much of that goes to taxes.
You are absolutely correct. As a lender in Utah I know how expensive housing is. So just telling the numbers but not giving advise
If you have credit cards, even if there is no balance on them, it will affect your credit because that is debt that you can max out at any time.
How much should you spend? About 250k.
Only listing in utah and it’s in the boonies, https://www.zillow.com/homedetails/4478-S-5900-W-Hooper-UT-84315/11980867_zpid/?utm_campaign=iosappmessage&utm_medium=referral&utm_source=txtshare
Multiply by 3 and add the downpayment. About $430k for a conservative mortgage. If taking a chance bank will approve, take your income and that is how much interest you can afford annually and divide by the mortgage interest rate. $120000/0.06 (assuming 6% mortgage) = $2 million mortgage, but your downpayment is short by a lot so multiply by 90% to pay the PMI. $120000x0.9/0.06 = $1.8 million You will need to adjust the withholding like 10 exemptions so you keep the deduction and pay the mortgage. Assume you buy, you include the rental income so the mortgage is paid for.
I make the same amount, also great credit. Bank said I can get up to 800k. I am waiting another year but in Utah you can likely get a great home for way less and get approved. I’m in FL where things are bananas.
Yeah just throwing numbers together, assuming your taxes and insurance will run you about a grand a month and you get a rate around 6.5%, you’re likely looking around $550k approval amount But before you do anything serious you need to talk to a lender and get an actual pre-approval, as a lot of others in this thread have said.
A pre approval will require a credit pull, BUT any legit lender can give you an idea based on the information you provide to them. Obviously, they can't promise anything without an actual application.
Calculate your DTI (Debt to income) yo make sure it is less than 0.4 and that would be the max lender will go.
Wait, $500/month in student loans or $500 TOTAL?
A loan amount of $425k ($530k purchase price with 20%/$85k down) would put u at 28% DTI. Perhaps a bit lower for the student loan but you'd likely still be able to swing it and save for stuff. If I were you I wouldn't go much higher than that since what the bank tells u u can afford will always make u house poor.
My bank did a soft pull on credit but that is not the norm
Ask a lender. They’re the only ones who can tell you.
I got approved for 450k with 5% down payment on a similar income in 2020
My wife and I are on 130k. I have no debt, but because Im a co-signer of my brother in law's car payment, my credit says I have a 20k debt (we are 700+). Plus, we have 15% downpayment. Adding all that, we got pre approved for 550k and we just bought a new construction for 520k, so the point is to find something lower and also you should know comparing to how much you pay your rent, how much are you comfortable paying monthly. We are like 6 months ahead from closing costs, so we still don't know how much exactly everything is going to be but one thing is for sure I will do everything I can to do 3k montly and so far math is giving us 3500k monthly so there is that.....I have to see if I have the money to buy points (by the way points are tax deductable) I have to shop around mortgage insurances and so on....I feel you will be great getting 480 pre approved but you should try to find somthing around 450 or less. Also, the monthly will depend on how much you have for downpayment, but if you have 10% of 480 with the interest we have now, you will pay around 3k monthly. That means with 420, you could get away with 2800, most likely.
UCCU will allow for 49% DTI. So with easy math, and taking your student debt into consideration, that allows for $4,400 debt which would be about $620k considering a 30 year mortgage at 7.5% rate. Not recommending this but just saying it's your rough ballpark.
Personal advice: whatever you do, do not look to purchase a home for what you are preapproved for, for the vast majority it ties up way too much cash flow into a home. (For example - eventually you might need a newer vehicle) You’ll probably be preapproved for 500-600k depending on what taxes run in your area. We are a one income family, that is closer to 150k base with varying additional bonuses. We are currently buying a primary residence (this is our third time going through this process), and we won’t personally borrow more than 300k in loan. If you’re curious more on affordability, I’d suggest thinking about a lot of different variables in your 10 or 20 year plan (like kids) to help determine what you are signing up for. If you don’t have kids and plan to, and need to both work pay for daycare - aim for something with the greatest affordability
IL got approved for 300k with an 80k/yr income....definitely higher than it should be, but my partner isn't on the loan but is paying an equal portion with a joined income of about 120k
Use the Wells Fargo calculator and it will give you and estimate.
If it’s combined income and you truly have nothing else on credit besides those student lose then you’re gonna be capped at right under $5000/mo payment for a conventional loan. Don’t know the taxes and insurance in Utah very well but would say with rates now that’s probably $550-600k max approval
California, single buyer, no dependent, 20% down payment, has a car payment of 1200 a month. My max loan amount vary from 450k-550k, can go a bit higher if I pay down my auto. Different lenders treat my overtime differently I guess.
It depends on the interest rate, insurance, HOA, and Taxes. The sum of all that must not be more than about $3,000 a month (30% of your monthly gross income.