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How Much Mortgage Can I Borrow?

How Much Mortgage Can I Borrow? Tips and Factors to Consider

Factors That Determine How Much Mortgage You Can Borrow

The amount of mortgage you can borrow depends on several factors, including your income, expenses, credit history, and the lender's criteria. Here are some of the key factors that lenders typically consider when determining how much mortgage you can borrow:

 

  1. Income: Lenders will consider your income, including any bonuses or overtime pay, to determine your ability to make mortgage payments. Most lenders will require that your mortgage payment not exceed a certain percentage of your income, typically around 28% to 36%.
  2. Expenses: Lenders will also look at your other expenses, such as credit card payments, car loans, and other monthly payments, to determine your ability to make mortgage payments. They will calculate your debt-to-income ratio (DTI) to determine how much mortgage you can afford. Typically, lenders prefer a DTI ratio of 43% or less.
  3. Credit history: Your credit history and credit score will also be important factors in determining how much mortgage you can borrow. A good credit history and high credit score will make you more attractive to lenders and may allow you to borrow more.
  4. Down payment: The size of your down payment will also impact how much mortgage you can borrow. The more money you put down, the less you will need to borrow, and the more likely you are to be approved for a larger mortgage.
  5. Interest rates: The current interest rates offered by lenders will also affect how much mortgage you can borrow. Lower interest rates mean that you may be able to afford a larger mortgage, while higher interest rates may limit how much you can borrow.

 

To get a more accurate idea of how much mortgage you can borrow, contact our broker who can evaluate your financial situation and provide personalized advice.

 

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