How Much Home Can I Afford?

How much house can you afford?

At the bottom of the page there is a Loan Calculator – for your use, and below are some basic instructions and comments about how to use it, but first…

Wouldn’t it be nice if we had a simple Home Affordability Calculator for you to input numbers?

Although it’s not that easy, it is easy (and free!) to meet with one of our agents and discuss your situation and home affordability. What’s most important to you, is most important to us. We know that granite counter tops and travertine floors are probably not the most important elements of your life.

At John Nitzken REALTORS, we want you to be happy and comfortable, throughout your life. We understand your home, your neighborhood and your budget are all very important. When you team with us, not only will we help you find a house…we’ll help you find a home that truly fits your needs.

Now…ABOUT THE LOAN CALCULATOR…

Purchase Price = The sales price of your home (e.g. “175,000″)

Down Payment = Percentage of sales price you plan on putting down (e.g. “3.5% or 10%)

Term = The years of the loan (e.g. “30”)

Interest = The loan interest rate (e.g. “5” or “4.25”)

Taxes = The yearly property taxes total (e.g. in the City of Louisville, where the city provides trash pick up, a typical yearly tax amount on a $165,000 home would be approximately $2,129. [or $12.90 per $1000 of home value as determined by the city tax assessor]. On the other hand, a $165,000 home in Jefferson County, but outside of the original city limits – where the home owner has to contract with an independent company for trash pick-up, a typical yearly tax amount on a $165,000 home could be approximately $1,689. [or $10.23 per $1000 of home value as determined by the city tax assessor].

Insurance = Home owners insurance to protect your investment. It is important to get estimates from insurance companies for this annual expense. Often, insurers will give you a discount if you “bundle” your car and home insurance policies with them. A good “guestimate” for the loan calculator is a yearly insurance cost of $5 per $1000 of home value. (e.g. If your Principal is $150000 and your Down is $15000, lets estimate your home value to be $165,000. $5 times 165 [since your home has 165 thousands of value] equals a “guestimated” yearly insurance of $825.)

PMI = Private mortgage insurance to protect your lender’s investment. This one is a very hard one to “guestimate”. Your mortgage professional will help you determine this. It depends on your credit score, how much money you put down on the purchase of a home, what type of loan you are getting (FHA or Conventional) and specific lender policy. To put you in the “Ballpark”, you might estimate a monthly PMI of 50 cents for every $1000 you borrow. (e.g. If your Principal amount is $150,000, you could “guestimate” your monthly PMI to be around $75/month). Talk with us about connecting with a professional mortgage consultant to get your specific PMI monthly amount.

Extra = Sometimes borrowers will elect to make extra payments toward their principal, to help them pay off their loan quicker. If you want to make any extra monthly payment to help pay your loan off early, plug that monthly amount in.

Use this Loan Calculator to give you a picture. Use John Nitzken REALTORS to give you an even better picture.

Give us a call and MAKE YOUR BEST MOVE EVER!