A mortgage is a loan secured by the home you buy, usually repaid over 15 or 30 years. When you are buying a home, lenders weigh your income, debts, credit score and down payment. A common guideline keeps housing costs at or below 28% of gross monthly income and all debt payments at or below 36%. On a conventional loan with less than 20% down, you usually pay private mortgage insurance (PMI) until you have built enough equity.
Lenders look at your debt-to-income ratio. Keeping the full housing payment, taxes and insurance included, near 28% of gross income leaves room for everything else.
Property taxes, homeowners insurance, PMI and any HOA dues can add hundreds of dollars a month to the principal-and-interest figure a basic calculator shows.
What's the Monthly Payment on a $300K, $400K, or $500K Mortgage?
Plenty of buyers put down less than 20%. On a conventional loan the trade-off is PMI and a bigger balance, so the real question is how much a larger down payment saves you.
How to Save for a Down Payment on a House (A Realistic Plan)
On a conventional loan you can ask to cancel PMI once you reach 80% of the home’s original value, and it has to end at 78%. Extra principal payments get you there sooner.
How to Get Rid of PMI: 6 Ways to Stop Paying Mortgage Insurance
How much house you can afford comes down to your income, debts, and down payment - not just the sticker price. Here's a clear, salary-by-salary guide, the 28/36 rule, and the real costs most buyers forget.
Wondering what a $300K, $400K, or $500K mortgage really costs per month? Here are the actual numbers at today's rates, the simple formula behind them, and why your real payment is a bit higher than the sticker figure.
You don't need 20% down to buy a house - most buyers put down far less. Here's how much you really need, where to keep the money, first-time buyer programs, and a realistic plan to save for your down payment.
PMI protects your lender, not you - so the sooner you drop it, the more you save. Here's how to get rid of PMI: the 6 ways to remove it, when it falls off automatically, how much equity you need, and the rules for FHA loans.
