1. Buying a Home – What you need to know

2. How Much House Can You Afford?
Most important thing to know:
What is your price range?
Found by figuring out the following:
Down Payment
Monthly Home Payment You Can Afford – Monthly Taxes
How the monthly payment translates to home price (formula: monthly payment divided by current payment per thousand multiplied by 1000

3. Down Payment Down Payment: Can be as low as 0% for some military
Is usually as low as 3.5% for an FHA loan all the way up to 100% of the purchase price.
The most important down payment benchmark to hit is 20%
If you put at least 20% down on a house, you will avoid Private Mortgage Insurance (PMI).
PMI is an extra payment each month to secure the bank from the possibility of you defaulting on your loan
PMI is a fee that you will never receive anything in return for
Benefit of PMI?

4. Example: Let’s See How Much of a House Someone Can Afford:
Yearly Salary: $50,000
Current Mortgage Rates are 4% which means a payment of $4.77 per thousand
Taxes in the area are $8000 per year
This person has funds of $40,000 available for a down payment