Make sure you know what mortgage you can afford when shopping for a house

Just because you are pre-approved for a large amount doesn’t mean you should spend that much.

Make sure you know what mortgage you can afford when shopping for a house
Make sure you know how much mortgage you can really afford when shopping for a house. Just because you are preapproved for a large amount doesn't mean you should buy at the higher end of your pre-approval.

RICHMOND, Va. (WWBT) - Experts tell us you really want to set yourself up financially when you a buy a new home. You need to figure out your budget and know what you can really afford.

Cherry Dale a financial coach with the Virginia Credit Union says that means when a lender gives you the amount of money you are pre-approved for-- that’s usually a big number and its based off your gross income. But Dale says you want to use your net income to make a home buying decision.

And she says you should only be spending about 30% of your net income on your mortgage. “If you’re making $3,000 net a thousand dollars a month can be put toward that mortgage. And then look within that price range when you’re initially starting,” said Dale.

Once you know what 30% of your take home pay is, you want to make sure you are looking at houses in that range. That way, after you close on the house and make that first mortgage payment there isn’t sticker shock.

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