Unlike renting a home, buying a home is a major financial decision. After all, if you can’t afford the rent, you’re only committed to paying off the terms of your lease – which is usually a year of payments or less.
However, if you’re buying your house, you’re committing yourself to 15 or 30 years of payments or paying off the balance of your principal if you sell the house early.
Mortgage Lenders generally look at your debt-to-income ratio and your house payment-to-income ratio to determine if you would be a good loan “risk.”
An acceptable debt-to-income ratio is 36% or less and your house payment should be 30% or less of your income. Whi;e lenders may have different requirements or percentages to determine your qualification, these are good averages to find a home payment range that works for you.