It is important for you to feel comfortable with the monthly house payment. The information is simply a guide for your payment that will include taxes, insurance, and principal (the actual house loan). 

Monthly Mortgage Payment Estimate

A good rule of thumb is that your mortgage payment, including taxes
and insurance, should not exceed 25-28% of your gross monthly income.

1. Gross monthly income $______ x 0.28 =  $_______


The amount of mortgage payment you can afford may be limited by your
monthly payments on long-term debt (those that will take more that 10 to 12
months to pay off). The total of your monthly payments on long-term debts
PLUS your proposed mortgage payment should not be more than 33-36%
of your gross monthly income.

2. Gross monthly income $_____ x 0.36 = ______

3. Monthly payments on long-term debt =  ______

4. Subtract line 3 from line 2 =                    ______

5. Enter the smaller of lines 1 and 4 =        ______


Now use the following formula to determine how much home you can afford.
Start with a purchase price equal  to approximately 2.5 times your annual
gross salary.


** Purchase price..................................                                $_______

** Less (-) down payment.....................                                $_______

** = Equals proposed Mortgage Amt.....                               $_______

** Monthly Principal & Interest payment
    of Mortgage amount .........................                               $_______
 
** Real Estate Taxes
    Approx. 2.5% of purchase price divided by 12...              $_______

** Homeowner Insurance (if applicable)
    Approx $5 per 1,000 of mortgage amount.........               $_______

** Mortgage Insurance (if applicable)
    Approx. $6 per 1,000 of mortgage amt divided by 12....   $_______

TOTAL MONTHLY MORTGAGE PAYMENT...................   $_______