Walk a Kb or Two in my Moccasins- Nobody 'splained it to me like that!

Simple answers to Complex Questions and Complex Answers to Simple Questions. In real life, I'm a Greater-Toronto (Canada) Realtor with RE/MAX Hallmark Realty Ltd, Brokerage. I first joined RE/MAX in 1983 and was first Registered to Trade in Real Estate in Ontario in 1974. Formerly known as "Two-Finger Ramblings of a Forensic Acuitant turned Community Synthesizer"

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Sunday, September 12, 2010

How much of a mortgage can I afford?

Q......How much of a mortgage can I afford?
from Zoocasa ASK the PROS

A....... Robert Ede




Quickly & assuming you have good credit and 5% down:



Take your Gross (ie pre-tax) Annual Family Income



Divide it by 40



Answer is the monthly payment you can carry including 1/12 annual taxes and est. monthly heat.



Subtract an allowance for 1/12 taxes & heat



Divide new answer by 5.25

= the # of thousands you can likely qualify to carry at 4% interest 25yr ammortization



EG

$90,000yr /40

=$2250/mth

less 300/mth (annual 3600 taxes)

less 200/mth (est.monthly heat)

=1750

div by 5.25 (factor per thousand at ~4% on a 25 yr ammm.plan)

= 333



You should be qualified for ~$333,000 mortgage

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