Simply How Much Home Are You Able To Afford?
| Monthly Pre-Tax Income | staying Income After Average Monthly Debt Payment | optimum Monthly homeloan payment (including Property Taxes and Insurance) aided by the 36% Rule | Estimated Residence Value |
|---|---|---|---|
| $2,000 | $1,400 | $120 | N/A |
| $3,000 | $2,400 | $480 | $79,000 |
| $4,000 | $3,400 | $840 | $138,000 |
| $5,000 | $4,400 | $1,200 | $197,000 |
| $6,000 | $5,400 | $1,560 | $256,000 |
| $7,000 | $6,400 | $1,920 | $313,000 |
| $8,000 | $7,400 | $2,280 | $360,000 |
| $9,000 | $8,400 | $2,640 | $416,000 |
| $10,000 | $9,400 | $3,000 | $523,000 |
In practice which means that for almost any pre-tax buck you make every month, you ought to devote a maximum of 36 cents to settling your home loan, figuratively speaking, personal credit card debt and so forth. (Side note: Since home taxation and insurance coverage re payments have to maintain your home in good standing, those are both considered debt re payments in this context. ) This portion also referred to as your debt-to-income ratio, or DTI.