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Think about your salary before buying a home in Richboro PA. Otherwise you might mis-figure the mortgage loan amount you need.
Lenders typically recommend earmarking 28% of your net income for your mortgage, For example, if your monthly income after taxes is $4000, the maximum monthly mortgage payment should be $1120. However, the amount you can actually afford might be different, depending on several factors.
Do You Carry Student Loans?
Many potential homeowners pay several hundred dollars in monthly student loan payments. If you’re one of them, think about adjusting your mortgage payment down below 28% to protect your budget.
Are You Paying Off Credit Card Debt?
Opt for a lower down payment if you’re saddled with credit card debt. If you’re debt-free, you have room to handle a larger mortgage payment with ease.
Do You Have Dependents?
Children are expensive. If you’re raising kids, or financially responsible for other family members, try your best to make a smaller percentage of your net income work for your monthly payment.
Are You Saving for Retirement?
A hefty start on retirement frees you up to pay the maximum 28% for your mortgage payment. If you’re trying to find the money to save, or if you haven’t started yet, adjust your plans lower and use the extra money toward 401ks or IRAs.
What About Expensive Hobbies?
If you love boating, traveling, skiing, or other expensive hobbies, don’t become “house poor”. Leave room in your budget to participate in activities you enjoy, even if this means a smaller home to achieve a more manageable payment.
Living in Richboro PA as a homeowner means carefully weighing the mortgage payment you can handle. Review these points closely, and make the best decision for your budget.