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Homes for Sale Brentwood TN | Brentwood TN Real Estate | Gennifer MallardHomes for Sale Brentwood TN | Brentwood TN Real Estate | Gennifer Mallard

Gennifer Mallard
Realtor, Real Estate Broker

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(615) 473-5973 Direct
(615) 371-1544 Office
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How Much House Can You Afford?

How Much House Can You Afford in Brentwood, Franklin, Nashville or the Surrounding Areas

Lenders determine whether you can afford mortgage payments by evaluating your credit risk and overall financial condition. Generally, they’ll want to make sure that your debt-to-income ratio is low enough that you can afford to repay them.

How to Determine Your Debt-to-Income Ratio

Mortgage lenders want to know that no more than 28 percent of your income will go toward repayment of your loan. Simply multiply your gross monthly salary by 0.28 to figure out how much house you can afford.

You can determine your own debt-to-income ratio by adding up all of your monthly obligations (including your current mortgage or rent payments) and dividing that number by your gross monthly income.

If you pay $1,000 for a mortgage, $500 in bills and $500 in other expenses, your monthly obligations are $2,000. Assuming your gross monthly income is $6,000 (remember, that’s before taxes), then you’ll divide 2,000 by 6,000.

In this case, your debt-to-income ratio is 33 percent.

How Lenders Assess Your Creditworthiness

For the most part, lending institutions use the 5 Cs to assess your creditworthiness. They take into account:

  • Credit history. Have you always paid your bills on time? Have you ever defaulted on a loan or declared bankruptcy? These and other factors provide lenders with your credit score, which shows how fiscally responsible you have been in the past. All legitimate lenders will check your credit rating before considering your application.
  • Capacity. Based on your employment history and past levels of income, lenders can get an idea of your ability to repay a large loan. Underwriters use your debt-to-income ratio to evaluate your credit risk and determine whether you have the capacity to pay back a mortgage loan.
  • Collateral. When you purchase a home, it’s through a secured loan – and the collateral is your home. If you fail to make payments on your loan, the home becomes the lender’s property.
  • Capital. Mortgage lenders view capital as anything you could rely on to make payments if you experienced a sudden loss of income. Your capital consists of investments, savings accounts, retirement accounts and other assets that you can quickly liquidate.
  • Conditions. Conditions of a loan involve how you intend to spend the money you receive from a loan. In the case of a mortgage loan, lenders will want to ensure you are purchasing a home by talking to your Realtor® and possibly inspecting the home.

Ready to Explore Middle Tennessee Homes in Your Price Range?

Call me at 615-473-5973 or send me a note online. I’ll be happy to build a custom search based on your needs and help you find the perfect home for sale in Williamson County.

Posted in: Blog, How-To, Real Estate

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Have a question? Give me a call at (615)473-5973, or you can click my photo for more options to call or email and I will contact you right away.

Featured Properties

918 Horizon Drive $668,578

918 Horizon Drive Franklin, Tennessee

3 Beds 4 Baths 2,311 Sq Ft Acres

2015 McAvoy Drive $668,325

2015 McAvoy Drive Franklin, Tennessee

4 Beds 4 Baths 2,726 Sq Ft Acres

2019 McAvoy Drive $668,210

2019 McAvoy Drive Franklin, Tennessee

4 Beds 4 Baths 2,726 Sq Ft Acres

1028 Wetzel Drive $668,111

1028 Wetzel Drive Franklin, Tennessee

4 Beds 4 Baths 3,109 Sq Ft Acres

72 Molly Bright Ln $664,900

72 Molly Bright Ln Franklin, Tennessee

4 Beds 4 Baths 3,482 Sq Ft 0.200 Acres

2013 McAvoy Drive $661,505

2013 McAvoy Drive Franklin, Tennessee

4 Beds 4 Baths 2,726 Sq Ft Acres

412 Dewar Drive $659,990

412 Dewar Drive Franklin, Tennessee

4 Beds 4 Baths 3,070 Sq Ft Acres

2011 McAvoy Drive $659,555

2011 McAvoy Drive Franklin, Tennessee

4 Beds 4 Baths 2,726 Sq Ft Acres

392 Dewar Drive $657,815

392 Dewar Drive Franklin, Tennessee

5 Beds 4 Baths 4,100 Sq Ft 0.250 Acres

302 Liebler Ln $655,250

302 Liebler Ln Franklin, Tennessee

4 Beds 4 Baths 2,726 Sq Ft Acres

3019 Halenwool Circle Lot 122 $654,432

3019 Halenwool Circle Lot 122 Franklin, Tennessee

4 Beds 3 Baths 2,566 Sq Ft 0.420 Acres

256 Moray Ct $653,336

256 Moray Ct Franklin, Tennessee

4 Beds 3 Baths 2,831 Sq Ft 0.120 Acres

226 Moray Ct $652,986

226 Moray Ct Franklin, Tennessee

4 Beds 3 Baths 2,910 Sq Ft 0.110 Acres

6019 Farmhouse Drive lot 116 $652,797

6019 Farmhouse Drive lot 116 Franklin, Tennessee

3 Beds 4 Baths 2,847 Sq Ft 0.120 Acres

3008 Halenwool Circle Lot 56 $652,253

3008 Halenwool Circle Lot 56 Franklin, Tennessee

3 Beds 3 Baths 2,790 Sq Ft 0.350 Acres

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Benchmark Realty, LLC

Gennifer Mallard, Realtor

615-473-5973 Direct

615-371-1544 Office

GenniferMallard@gmail.com

Benchmark Realty, LLC
318 Seaboard Lane, Suite 112
Franklin, TN 37067
License #00292590
Company License #259153

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