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Buying a home

Buying a home

Ratings: (0)|Views: 83|Likes:
Published by Christopher W.
reality check: how to know what you can afford, comparing it to what you make and knowing what all of it means. Closing costs and mortgage brokers are important to stay debt free or reduce credit debt
reality check: how to know what you can afford, comparing it to what you make and knowing what all of it means. Closing costs and mortgage brokers are important to stay debt free or reduce credit debt

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Published by: Christopher W. on Aug 18, 2009
Copyright:Attribution Non-commercial


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Consolidated Credit Counseling Services, Inc.
5701 West Sunrise Boulevard
Fort Lauderdale, FL 33313

Residential Mortgage Financing

Homebridge Mortgage Bankers specialize in helping consumers of all credit types. Whether your look- ing to lower your monthly mort- gage payment, need cash in a hurry or you are looking to purchase that dream house, we have the program to meet your needs. Homebridge can close your loan in as few as seven days, remember, we\u2019re the bank, we make the decisions and we cut the check. Call us for a free loan analysis and see why Homebridge is a leader in the home financing industr y.

350 Fairway Drive \u2022 Suite 110 \u2022 Deerfield Beach, FL 33441 \u2022 954-335-3700

This informational home buying
publication is made available
to you through an educational
grant from

Congratulations on taking this important step to a brighter \ue000nancial future. Consolidated Credit Counseling Services, Inc. has been helping Americans across the country solve their credit and debt problems for more than a decade.

Our Educational Team has created over twenty publications to help you improve your personal \ue000nances. By logging on to www.ConsolidatedCredit.org you can access all of our publications free of charge. We have the tools to help you become debt free, use your money wisely, plan for the future, and build wealth. The topics Consolidated Credit addresses range from identity theft and building a better credit rating to how to buy a home and pay for college. On our web site you will also \ue000nd interactive credit courses, a \u201cBest of the Web\u201d debt calculator, a personalized budgeting tool, and much more.

We are dedicated to personal \ue000nancial literacy and providing a debt-free life for Americans. If you are overburden by high interest rate credit card debt then I invite you to speak with one of our certi\ue000ed counselors free of charge by calling 1-800-210-3481 for free professional advice. We also have partnership programs available where groups, businesses, and communities can hold \ue000nancial workshops and receive free money management guides and workbooks like the one you are reading now. Please call 1-800-210-3481 if you would like to discuss pursuing a personal \ue000nancial literacy program.


Gary Herman
Consolidated Credit Counseling Services, Inc.

Buying A H\ue000me

With interest rates low, many renters would find that the monthly payment on a home would be similar to what they are now pay- ing for rent \u2013 or even less. But many people still don\u2019t buy a home because they find the whole process intimidating. In this brochure, we answer three of the most common questions people ask when they are thinking about buying their first home:

1. What price home can I afford to buy?
2. How much will it cost?
3. Can I qualify for a loan?

Our goal is to help you feel more confident, and get you ready to buy
a home if that\u2019s right for you.
H\ue000w Much Can I Aff\ue000rd?

The general rule of thumb is that you can afford a home that\u2019s about two to three times your annual income. So if you make $50,000 a year, you may be able to buy a home for $100,000 -- $150,000. But that\u2019s just a rough rule of thumb. The last thing you want to do when you buy is to stretch yourself so thin that you can\u2019t afford to do anything outside your home!

Lenders will look at your housing and debt ratios in determining how
much they think you can afford.
H\ue000w Much D\ue000 Y\ue000u Really Earn?
Before you can figure your housing and debt ratios, you must be clear
about how much you earn, in terms of your gross monthly income.

Gross monthly income is your income before taxes. If you are paid an
annual salary then take that salary before taxes,
health insurance premiums or retirement plans are taken out.
Divide it by 12, and that will give you your monthly income.

Your annual income
Divide by
\u00f7 12
Equals your gross monthly income
If you are paid hourly:
Your hourly pay

Multiply it by the number
of base (or regular) hours
you work each week

Then multiply your answer by 52
(the number of weeks in a year)
x 52
= Your annual salary
Divide that by 12
\u00f7 12
= Your monthly income
Let\u2019s say you earn $20/hour and you normally work 25 hours a week.

\u2022 You\u2019ll take 20 and multiply it by 25 = 500 to get a weekly figure.
\u2022 You\u2019ll then multiply 500 x 52 = 26,000 to get an annual figure.
\u2022 Then divide 26,000 by twelve to get a monthly income of $2166.

In calculating your income, a lender must allow you to include:
\u2022 Child support or alimony, usually if it will continue for at least
another 3 \u20135 years
\u2022 Retirement income, including Social Security benefits or a pension
as long as it will continue.
If you have income from a side business or if you are self-employed, you\u2019ll

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