How much Home Loan are you qualified for?

If you’re thinking about making a giant leap into the housing market, it’s all good but do you know how much mortgage loan you qualified for? As the pros always remind us, planning now is the key. But what if you just want to get a quick “big picture” of how much housing loan you can afford at your current income. As you probably already know, it takes anywhere from 1% to 20% down on a mortgage loan conventional or FHA but that’s another story. Where I’m going with this post is simply a quick way to find out how much mortgage loan you are eligible for based on your income. I came across this sweet little app from US Bank that I thought the first-time home buyers might benefit from. If you just want a quick calculation based on your annual income alone, then try this app from Bankrate.com but first let me finish telling you about the US Bank.  It’s a mockup sample of what you can afford (not really mock-up because of the fact that they ask for your personal info), given your current income and estimate of your monthly mortgage payment. The calculation is based on your income, your credit rating, yielding your final mortgage loan you qualified for. The two examples below illustrate what you can expect for an individual making $33,900 annually; and 2nd example based on an income of $28,800. It is interesting how just a few thousand dollars ($5,000) can make a huge difference in the qualifying amount.

What it gets down to is that they perform an assessment to determine whether your income and debt-ratio fit their bank’s Mortgage loan programs. Based on the above information,  a person may be able to borrow the following:(with Annual Income of $33,900)

  • Loan type and term: 30 Year FHA
  • Estimated loan amount: $175,000.00
  • Estimated monthly payment: $811.00

Second Example:

Again this is based on the information provided above, a person may be able to borrow the following: (w/annual income of $28,800)

  • Loan type and term: 30 Year FHA
  • Estimated loan amount: $144,000.00
  • Estimated monthly payment: $665.00

The Bankrate option has everything that you need to know about your loan and more such as how much hazard insurance you’re going to be needing for the amount of loan you’re approved for, property tax, PI or PMI, etc. The interface APP on their website is pretty slick and they don’t ask for your personal information (huge advantage) like other websites do. They even have a pie graph generated along with other information above on the fly upon your input of your annual income. Pretty neat uh? Try it out and see for yourself, it will certainly help you out with your planning.

 




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