Buying a home is a thrilling and rewarding adventure! You’ll want to put your best foot forward and prepare a simple household budget to help you determine your own affordable housing payment. Here is an excellent fillable form to help you get started.

FTC Household Budget Tool

Once you have completed your budget you’ll be on your way to knowing how much monthly cash flow you have available for a housing payment. Three things that you should also consider:

1. Home Maintenance – this is not covered in the budgeting tool and will vary based on the home you select. Newer homes tend to have less maintenance issues. You should have a building inspection performed as part of evaluating any property you are serious about. The inspection report will show the age and condition of the structure and its systems. I usually recommend putting $200/mo in a savings account specifically for home maintenance.
2. Home Improvements – most people want to add some spice to their new home. Be sure to take this into account and budget for it when you are evaluating your options.
3. Furnishings – leave a little room for buying a few new pieces and an upgrade to other items like towels and dishes. If you don’t have savings for this, plan for an aggressive repayment of the new debt in your budget.

A housing payment has several components. You have to repay the loan (Principal and Interest or P&I), the lender will collect property taxes and homeowner’s insurance with your monthly payment. If you’re putting down less than 20% of the purchase price, you’ll probably pay mortgage insurance. We also consider the homeowner’s association fee part of the housing payment, though it is not collected by the lender. You’ll pay your neighborhood association directly if you live in an organized community.

Convert Your Affordable Housing Payment Into a Home Price

Most first timers put a small down payment (5% or less) into their home. If that’s the case, you’ll be able to translate the payment above directly into a home price with the following worksheet (If you’re putting 10% down, you can add about $20,000 to the price.) :

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Play with these tools and when you’re ready to have a conversation, call one of our certified Home Loan Advisors for more information! We’re here to serve.