How much money should I spend on a home mortgage?

If you are wondering how much money should I spend on a home mortgage you should use an online detailed mortgage calculator to help guide you or talk to a lender before you start. Many lenders are happy to provide you with information up front even before you start looking at homes.

If you take the online approach, SmartMoney provides a great calculator to help you get an idea of how much house you can afford. The basic rule of thumb is between 28% and 33% of your gross monthly income. Be very careful when using online calculators because there are many factors involved that most don’t include.

However, with that said I personally think there are many other factors involved in how much you should spend on your home mortgage. I would personally take a more conservative approach and suggest staying under the 20% range. There are many factors involved in your personal finances that a lender won’t look into detail. My personal rate is around 15% and sometimes the budget runs tight with gymnastic class, dance lessons, rising fuel costs, eating out and the list grows.

Carefully consider all your expense before you sign on the line.