How Much Can I Afford?
What amount should I establish for my monthly mortgage payments?
House hunting begins at home... with planning. Knowing your affordable price range will bring your house hunting into focus.
How much house you can afford depends on two things: how much you can afford for the monthly mortgage payment, and how much you can invest in the down payment. Monthly payments include the principal and interest on the mortgage loan and property taxes and insurance against fire and other hazards. These four costs are often abbreviated PITI.
The key items are the size of the down payment, the amount of the mortgage and the term – or length – of the loan.