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How to Figure Out How Much Home Can You Afford

Unless you’ve already used a Home Affordability Tool or undergone a homebuying assessment, it may be difficult to figure out how much home you can afford.

Doing some research can help you eliminate some of that uncertainty. You could look at some rental options to determine what’s important for you in a home as well as the cost of the rentals. You can then apply what you’ve learned to figure out the difference between what the rent would be on those properties and how much a home you’d want to buy would cost.

From there, start saving the difference, according to New American Funding Senior Vice President of Growth and Expansion Mosi Gatling.

“If you go out and find a home and the house payment would be $2,000, then you should save $2,000 a month,” said Gatling. “It’ll help you gain the habit of paying that monthly payment…and in the meantime, you’re gaining this great nest egg.”

Mosi Gatling NMLS# 557166