12/15/2023 0 Comments Accurate mortgage calculator with pmi![]() There are two ratios – a “front” ratio which consists of your proposed housing debt (principal, interest, taxes, insurance, plus PMI or flood insurance, if applicable) divided by your income. What is DTI?ĭebt to income ratios are just what they sound like – a ratio or comparison of your income to debt. Your loan officers and underwriters will be looking at your DTI to determine if you’re worthy of a mortgage or if you’re better off living in your parents’ basement. In the above form, once you enter your monthly income, recurring (monthly) debt and estimated housing expense details, the debt-to-income (DTI) ratio calculator will calculate your front-end and back-end (total) ratio to help you understand your current financial situation and accurately estimate your probability of getting approved for a mortgage. If your loan officer doesn’t mention DTI, your underwriter will. Key word “if”.If you’re buying a house and getting a mortgage, you will probably hear the words “debt-to-income ratios” or DTI. I know that rent is the most we’d pay, and a mortgage is the least, but we’d be willing to pay slightly more to own a place if it makes financial sense. If we don’t purchase, we’d be looking to rent a townhouse anyway for $2.5k-ish. below $400k) would almost entirely limit us to condos, and we mostly want to move so we can stop living above/below people after many years of apartment living. On one hand $490k seems high, and ideally we’d want to spend less than that anyway, but I also know that going significantly lower (e.g. Does this mean that $490k should be our absolute top limit? Is that realistic? Everything theoretically fits and we can still add to our savings. So basically… Do these calculations seem accurate? I’ve created a sample budget with our same expenses but with $2.8k in housing, increased utilities as we’d have a larger space than we have now, 1% of home value for maintenance, and a car payment even though we don’t have one and it’d ideally be a couple years down the road. Which calculates over a 30 year mortgage to a home price of $490k. Mortgage principal and interest: $2000.But working backward from max $2.8k monthly, most of the calculators seem to break it out roughly like: We’re looking at townhomes, because most single family homes in the areas we’re looking (under 1hr commute) start at $550k-$600k, so we’d likely have HOA fees. We’ve looked at our monthly/annual budgets and feel like we should be able to afford max $2.8k monthly for housing, ~32% of our take-home (ideally less of course) but this max would include the mortgage, property taxes, homeowner’s insurance, any potential HOA fees, and PMI. Kids: None, nor planning on any in the future.Savings: $30k saved for down payment and $10k closing costs, additional $50k split between emergency fund and savings for eventual new car and vacations but neither of those will be happening anytime soon.No car payments or other debts currently. ![]() Debt: $400 combined student loans monthly.Household income: ~$150k, we both work full-time, our jobs are stable.We’re trying to figure out what home price to target using a variety of calculators online but aren’t sure how accurate they are. Neither of us come from money and we don’t have a lot of people from whom to solicit financial advice. We haven’t gotten pre-approved yet, but we’re doing research to see if it’d make sense. ![]() My spouse and I are in our early 30s and live in a HCOL area (DC) and are looking to purchase our first home when our apartment lease is up. Here, please treat others with respect, stay on-topic, and avoid self-promotion.Īlways do your own research before acting on any information or advice that you read on Reddit. Get your financial house in order, learn how to better manage your money, and invest for your future. Banking Megathread: FDIC, NCUA, and your cash.Private communication is not safe on Reddit. ![]()
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