How much house can I afford on my salary?
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A general rule is you can afford a home 3-5x your annual gross income. For example, a $100K salary typically supports a $300K-$500K home. However, this varies based on your debts, down payment, credit score, and local tax rates. Our calculator gives you a personalized number.
What is the 28/36 rule for home buying?
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The 28/36 rule says your monthly housing costs (mortgage, taxes, insurance) should be no more than 28% of gross monthly income, and total debt payments should stay below 36%. Some lenders allow up to 43% total debt-to-income ratio for qualified borrowers.
How much down payment do I need?
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Down payment options include: Conventional loans: 3-20% (PMI required under 20%). FHA loans: 3.5% minimum. VA loans: 0% for eligible veterans. USDA loans: 0% for rural areas. A larger down payment reduces your monthly payment and may get you a better interest rate.
What other costs should I budget for besides the mortgage?
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Beyond your mortgage payment, budget for: Property taxes (1-2% of home value annually), Homeowner's insurance ($1,000-$3,000/year), PMI if under 20% down ($50-$200/month), HOA fees if applicable, Maintenance (1% of home value/year), and Utilities.
Does my credit score affect how much I can afford?
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Yes, significantly. A higher credit score gets you a lower interest rate, which means you can afford a more expensive home with the same monthly payment. For example, the difference between a 620 and 760 credit score can mean 1-2% higher interest rate, costing you $200-$400 more per month on a $400K home.