Home Buying in 95843>Question Details

Pearl Ahlqui…, Real Estate Pro in Fair Oaks, CA

With all the bad news about mortgage products and home foreclosures, how do I avoid making a big mistake when deciding which type of loan to select??

Asked by Pearl Ahlquist, Fair Oaks, CA Tue May 28, 2013

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it has nothing to do with the type of loan to select.

It's dependent on following basic financial principles. For a balanced budget, your housing expense should run around 30% of your gross income. That assumes you have no large debts that you are paying off etc.

A lender, running a debt to income ratio, will run at different rates depending on your other debt. Some of that might confuse the average person. Stick with the rule- no more than 30% of your gross income and you shouldn't have a problem. From there having 6 months in savings will hopefully protect you should any difficulties happen such as a job loss or out of work because of illness.
0 votes Thank Flag Link Tue May 28, 2013
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