How Much Mortgage Can You Afford?


>>> YOU FELL IN LOVE WITH A HOUSE AT FIRST SIGHT, BUT BEFORE YOU SIGN ON THAT DOTTED LINE CONSUMER REPORTS SAYS MAKE SURE YOUR ODDS AREN'T BIGGER THAN YOUR BANK ACCOUNT HERE'S JENNIFER KRAUS

>> REPORTER: THEY JUST BOUGHT THEIR FIRST HOME >> WHAT'S THE FIRST THING WE NEED TO DO? >> REPORTER: WHEN TRYING TO DETERMINE THEIR PRICE RANGE THEY HAD TWO GOALS, KEEP THEIR MONTHLY HOUSING COSTS BELOW WHAT THEY WERE PAYING FOR RENT AND HAVE ENOUGH MONEY LEFTOVER AND THEN SOME >> WE TRIED TO SAVE AT LEAST A CERTAIN AMOUNT OF MONEY EVERY MONTH >> REPORTER: THEIR BANK APPROVED THEM FOR A CERTAIN NUMBER CONSUMER REPORTS SAY THAT NUMBER CAN BE DECEIVING

LENDERS LOOK AT HOW MUCH YOU CAN PAY THEM EACH MONTH >> THAT DOESN'T MEAN YOU CAN MAKE THE PAYMENTS AND STILL SAVE FOR RETIREMENT AND STILL MANAGE TO GO ON A VACATION EVERY YEAR >> DECIDING HOW MUCH MORTGAGE YOU CAN AFFORD IS PERSONAL, BUT EXPERTS SAY A GOOD RULE OF THUMB IS TO CAP YOUR HOUSING COSTS AT 25% OF YOUR TAKE-HOME PAY THIS SHOULD AFFORD YOU A LITTLE WIGGLE ROOM >> YOU NEED TO HAVE MONEY IN CASE THE AIR CONDITIONER BREAKS OR THE ROOF

OWNING A HOME IS VERY COST-INTENSIVE, SO KEEPING YOUR MORTGAGE PAYMENTS AS LOW AS POSSIBLE WILL HELP AFFORD EVERYTHING ELSE THAT GOES WITH IT >> REPORTER: IN THE END THEY FOUND A HOME THEY LOVE FOR LESS, LEAVING ENOUGH ROOM IN THEIR BUDGET TO START SAVING FOR THE NEXT BIG THING >> WE REALLY WANT TO HAVE A NEST EGG RIGHT NOW FOR VACATIONS EMERGENCIES, AND EVENTUALLY DOWN THE ROAD HAVING OUR FIRST CHILD >> REPORTER: HAVING TROUBLE CALCULATING A NUMBER YOU CAN LIVE WITH

WORKING WITH A FINANCIAL PLANNER OR A THIRD-PARTY YOU JUST CAN BE A GOOD MOVE JENNIFER KRAUS, NEWSCHANNEL5 >>> A RECENT BANK RATE REPORT SAYS 80% OF — MAKE IT DIFFICULT TO SAVE MONEY, AND PARENTS ESPECIALLY HAVE A HARD TIME

Source: Youtube


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