I make about $32,000 per year- I only have 1 debt and that is my car $475.00 per month. How much house?

Asked by Leslie Roe, Warren, MI Thu Mar 6, 2008

approx. would I usually qualify for?

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14
Fooshie, , 48021
Thu Jul 24, 2008
If you have auto debt, then perhaps you're asking the wrong question. Unless your job is set in stone, then what you can afford is how much cash you have in the bank. If you look at "how much a month" instead of "how much", then you're prognosticating, which is dangerous for us mortals who cannot guess the stock market, much less whether we'll have a job (or a job that pays our current rate) in 4 years. Do you have an emergency fund (cushion) in place for when the car breaks down, or the fridge in your new house goes kaput? Do you have 4 to 6 months of living expenses in the bank so when you do lose your job, you don't lose your house, too? If you haven't answered these questions, then asking how much house you can afford is like asking how long you can hold your breath underwater until you drown. I'd suggest taking Dave Ramsey's Financial Peace University course, and going with his recommended 100% down plan. In otherwords, save up for purchases (including the house) and pay cash, rather than making Countrywide rich on the interest you pay them.
Web Reference:  http://www.daveramsey.com
2 votes
No auto debt
Flag Tue Mar 21, 2017
Horrible advice. Noone pays everything 100 percent.
Flag Sun Aug 30, 2015
Leslie Roe, Home Buyer, Warren, MI
Fri Mar 7, 2008
Thanks Melinda, I agree with you the one person who responded about me living in my car was rude.
I have spoken to a few places and I now that I can find a smaller house/condo around 100,000-115,000. I pay $720.00 per month at my apartment with no problem. Thanks for being so kind, I will definately be in touch.
2 votes
Melinda J. R…, Agent, Hudsonville, MI
Thu Mar 6, 2008
Leslie, I have to disagree with the response that you can't afford a house or your car. You are in a good position because you really have minimal debt. There are alot of great mortgage programs out there. You really should find a good loan officer to that can give you honest answers. I know people who do not even make that much that have had good credit and get into a house. Granted you aren't going to be buying a $500,000 house. This is probably not going to be a dream home that you are getting into, but a great way to start building equity for yourself and not your landlord!

I work with a couple of great loan officers. Let me know if you would like their names and numbers. I hope this information helps! Best Wishes to you!
Web Reference:  http://www.gomelinda.com/
2 votes
Jim Gleason, Home Buyer, Solana Beach, CA
Thu Mar 6, 2008
If you make $32k per year and have a car payment of $475 per month, you can't afford your current car let alone a house.

I suggest you sell your car and take public transit and start saving money. Buying a house should be the last thing on your mind right now. You're much closer to living in your car than buying a house.
2 votes
Wow, what an ass
Flag Fri Oct 28, 2016
Maureen Fran…, Agent, Birmingham, MI
Thu Mar 6, 2008
Leslie,

I don't typically see too many mortgage people answering questions on Trulia Voices. My suggestion is that you talk to a reputable local mortgage professional to get prequalified or preapproved. If you need some referrals for people we've had good experiences with in the past, please feel free to contact me. Or if you have a Realtor, your Realtor should be able to point you in the right direction.

Good luck!
Web Reference:  http://mioaklandcounty.com
2 votes
Derek Bauer, Agent, South Lyon, MI
Thu Mar 6, 2008
Good morning, Leslie! I am glad to see you are at least considering an investment in Real Estate, as it is a fantastic time to do so!

I think you would be surprised how much you could actually afford. Here is a good way to ballpark it...

Below is a link to a very nice home I have for sale in Warren (simply picked that, as you appear to be in that area). Scroll down the page and you will see where there is a Mortgage Calculator, and inside of that a Loan Qualifier. Check it out

http://www.doortodreams.com/properties/index.php?action=list…

I would be happy to assist you further ... feel free to contact me at any time. Enjoy your day!

Derek Bauer, Associate Broker / Real Estate One
Web Reference:  http://www.doortodreams.com
1 vote
Bob McClure, Other Pro, Walled Lake, MI
Sat Jul 26, 2008
hi...why not call me?.i need to know a couple of things.... and i can answer your question..bob mcclure- mortgage now- farmington, michigan.. (248) 806-0366.....almost 14 years experience....weekends are okay...
0 votes
Sherry Denton, Agent, Saint Clair Shores, MI
Fri Jul 25, 2008
As a rule of thumb, don't let your rent or house payment exceed 1/3 of your income. So in this case $888. Less if you have a lot of debt, but never more than 1/3rd.
0 votes
NonRealtor, , 23456
Thu Jul 24, 2008
Save your money. Houses will be cheaper next year. As a rough estimate, an affordable house is 3 times your income. So in your case 3 x 32,000 = 96,000
0 votes
Fooshie, , 48021
Thu Jul 24, 2008
I should add...a lot of people think it's rude to be told "perhaps you can't afford it". Because we have had debt marketed to us so effectively, that we're almost offended when we are told to wait. Especially when a lot of other people who make their living off mortgages (real estate pros, mortgage lenders) are encouraging you to take the plunge into home debt. (By posting on this board, it's as if you had asked a car salesman how much car you can buy - it's the wrong person to ask.) Resist the temptation to see debt as a privilege, because I guarantee not a single one of the people on this board will be around to pay your mortgage payments for you if you get in trouble and fall behind. You'll be going through living hell as you deal with questions such as "Where do I go?", "What do I do?", "How will I live?", "Will this ruin my credit?", "Do I declare bankruptcy?", and all the folks who told you that almost $500/mo car payment was "minimal debt" will be nowhere in sight. Do you think that a single person in the U.S. that has undergone foreclosure over the past 2 years intended to do so when they purchased their house? By the way, if the real estate pros are telling you that you have "minimal debt", then ask THEM to pay your minimal car payment for you! You'll see how small your current debt really is!
0 votes
Ryan Branden…, Mortgage Broker Or Lender, Boca Raton, FL
Fri Apr 18, 2008
If I can answer any questions for you please call me direct and we can go over.
--payments
--closing costs
-- interest rates

I look foward to speaking with you.

Ryan
954-394-9005
0 votes
Leslie Roe, Home Buyer, Warren, MI
Fri Mar 7, 2008
Thank you Gary, I appreciate your time. I am definately going to look into the MSHDA- I am going to take a look right now at the HUD approved lenders website. Thanks again for your response!
0 votes
smith3gary, Agent, White Lake, MI
Fri Mar 7, 2008
Leslie, New FHA loan limits were released March 5th. In Macomb County the maximum limit is $297,500. The State of Michigan also has a MSHDA loan program where qualified applicants can receive a discount on their interest rate of up to one percent. More information is available at http://michigan.gov/mshda to see if you qualify.

I suggest speaking with several loan officers. A list of HUD approved lenders is available at http://www.hud.gov/ll/code/llplcrit.html

Sample real estate forms and loan calculators are available on the website below. Sorry it took an extra day for me to post this information, yesterday was a very challenging day for me. I see even my previous answer was deleted with Dereks 14.
Web Reference:  http://www.mi-living.com
0 votes
Leslie Roe, Home Buyer, Warren, MI
Thu Mar 6, 2008
Thank you so much everyone for your valuable input! I appreciate your time.
0 votes
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