I make $175k a year, how much house can I afford?

Good to know that you earn $175k per year which is good salary

I always here to help you out.

The minimum ideal salary for a year is $100,ooo to mortgage a property, and you earn more than that,

so it is easy for you to mortgage your dream house.

but first you have to make sure some things, which are following

1: Your PITI is less than 28% of your salary.

PITI ( Principal, Interest, Taxes, Insurances )

A good rule of thumb is that PITI should not exceed 28% of your gross income.

However, many lenders not guide well and let borrowers exceed 30%, and some time even 40%, which is not good.

2: Your DTI is less than 36% of your salary.

DTI ( your mortgage, credit card payments, child support and other loan payments )

To calculate your maximum monthly debt based on this ratio, multiply your gross income by 0.36 and divide by 12.

through this you can know your monthly debt.

For example;

if you earn $100,000 per year, your maximum monthly debt expenses should not exceed $3,000.

According to your salary which is $175k per year multiply this with 0.36 and divide by 12

$175,000*0.36=$63,000

63,000/12=$5250

your maximum monthly debt expenses should not exceed $5250.

Remember one thing you have to give 20% as down payment of the purchase price greater the down payment will minimize the interest .

NOTE:

*Some time our daily life expenses will exceed more then our thinking so i recommend you to plan like the way you can save money as well.

*There are many online calculators to calculate affordability to mortgage.

Good Luck.. !

PS: if you need any help related to Mortgage visit this;

How Much Mortgage Can I Afford On My Salary Calculator

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