Can I afford a $140,000 house making $50,000 a year?
I make $50,000 a year. I have no car payment or student loan. I have about $5,000 in credit cards. Can I afford a $140,000 house?
I do have enough money to put a 20% down payment but Im not sure if I want to. Any suggestions on that as well?
I have a credit score of 720... is that good?
- falsi fiableLv 71 decade agoFavorite Answer
The issue has to do with debt ratios. A rule of thumb is that you can afford a mortgage that is 3 to 3-1/2 times your gross annual income (before taxes).
In general, lenders will let you spend between 28 to 33% of your gross monthly income on your mortgage payment (including property taxes and insurance).
Your total debt load (mortgage plus car payments and minimum payments on revolving balances) must not exceed about 38 to 41% of your gross monthly income.
These numbers are realistic general guidelines and your situation could be different.
- Anonymous1 decade ago
Yes you can, but to be absolutely sure your credit is good and your income is calculated correctly, you need to contact a lender. You should not need to put 20% down either, but your payments will be lower if you do.Source(s): Lender in California
- Beverly SLv 71 decade ago
Your score is good & it sounds like you will easily qualify. I would put the 20% down & go conventional which will allow you to avoid paying mortgage insurance. You also get a slightly better rate. Or you can go FHA with 3.5% down- slightly higer rate & pay mortgage insurance. Good luck.Source(s): 24 years mortgage lender.
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