Finding a Home
Financing a Home
Closing on a Home
How much house you can afford?
Figuring how much house you can comfortably afford can be complicated, so know your budget before you begin shopping.
How much can I afford?
Shopping for a new home? Find out how much you can afford.
Consider this rule of thumb for deciding what you can afford
You’ll hear different advice on what you can afford depending on who you ask, but a good rule of thumb is to keep to these limits:
- 36% of your income goes to pay debts.
Banks generally advise that your mortgage payment not be more than 28% of your monthly income, leaving 8% for other debts like car or student loans.
- 31% of your income goes toward taxes.
That's the national average.
- 33% of your income goes toward everything else.
Food, clothes, entertainment, vacations, savings, and investments that you put away for a rainy day.
|Homeownership expenses||What||How often|
|Before you buy a house||Credit report
Home inspection (Opens Overlay)
|One-time fee (credited at closing)
One-time fee (typically between $200-$500)
|During the homebuying process||Application fee (Opens Overlay)
Earnest money (Opens Overlay)
Origination fees (Opens Overlay)
Closing costs (Opens Overlay)
Title insurance (Opens Overlay)
One-time fee (credited at closing)
One-time fee (typically between 2-6% of the loan amount)
|After you buy a house||Property taxes
Private mortgage insurance (PMI) (Opens Overlay)
Homeowners, hazard or flood insurance (Opens Overlay)
Homeowners association dues (Opens Overlay)
Utilities (water, gas, sewage, etc.)
Maintenance & repairs
Lawn care and landscaping
Monthly through an escrow account or semi-annually
Monthly through an escrow account or annually
Monthly and/or annually
Monthly or quarterly
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