With all the discussions about sub-prime loans and home prices, many of the people I talk with are concerned they can't afford a home. You do need savings to be a good homeowner, for maintenance and emergencies.
But how much is too much to spend on a house?
The rule of thumb is 33%. Your monthly housing costs, including principal, interest, taxes and insurance should not be more than 33% of your gross income. With all your other loans and credit cards, your total debts should not be more than 38% of your gross income.
If you have any additional questions about affording a home, give me a call.
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