Home shopping in Prince William or Fairfax County can be tough when you’re not sure how much you can afford. If you’ve wanted to live the dream of owning your own home, but haven’t been sure where to start, I’ve put together a few tips that can make it easier to get a handle on where to start.
Tax benefits usually mean you can afford more than your rent.
Interest deductions on taxes typically translate into significant savings. Many people find they can afford about 33% more than their current rent. To get an idea of what this might be for you, multiply your current rent by 1.33.
A home price two-to-three times your gross income is usually a reasonable place to begin.
For example, if your household made $75,000 last year, you could begin looking for a Northern Virginia home in the $150,000 - $225,000 range to start.
Know how much you can put down.
Ideally, you’d want to have 20% of the home’s price set aside for a down payment. On a $200,000 home, this would be roughly $40,000. While people qualify with less, it can result in higher interest rates (which translate to higher monthly payments).
Determine your “debt factor.”
Lenders will often cite the 28/41 rule when it comes to your debt. This means that your mortgage (plus taxes and insurance) shouldn’t exceed 28% of your gross monthly income. Your total payments (credit card, car loan, etc.) plus your mortgage shouldn’t come to more than 41% of your gross monthly income.
I often work with first-time buyers and renters to get themselves lined up for home ownership. If you’d like to learn more, or have questions, I’d be happy to help. Call me today!
If you have any inquiries about home selling and/or property investments, feel free to email me as well. I will personally help you with what you need.
I also have an online library that contains helpful information about real estate, the current market, home tips for all seasons, home buying/home selling tips, and other updates that you will find useful~ all yours to read and download! Simply register your email address at the form below and I'll be sending you the link for FREE!
Sean Blanchette(703) 371-5710 Sean@FrontDoorHomes.comDownload my Mobile App ~ Text KWJRGEI to 87778 Now!
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