If you are a renter, you might be wondering how much mortgage you can afford. Please use the Rent vs. Buy calculator on my website to figure out what you can afford. I thought the following information was interesting, so I am sharing it with you. It is reprinted with permission from the National Association of REALTORS and reprinted from REALTOR Magazine Online.
The following calculation assumes a 28% income tax bracket. If your bracket is higher, your savings will be, too.
Rent: _____________
Multiplier: X 1.32
Mortgage Payment: __________________
Because of tax deductions, you can make a mortgage payment – including taxes and insurance – that is approximately 1/3 larger than your current rent payment and end up wtih the same amount of income.
Not only does owning a home give you a haven for yourself and your family, it makes great financial sense, too. Right now, if you are a first time home buyer you can take advantage of the $8,000 tax credit available. You must hurry, because it ends in April! Call me today so we can get started.
