Value Your Fixed Costs
Before you decide what you spend on a mortgage it’s main to take stock of your habits and your true fixed costs. Be sincere with yourself when put together your home budget, if you’re going to be sad without your daily premium cup of coffee, then along with your student debt and car payments.
Paying Off Your Mortgage
Once you are accepted for a mortgage and buy your home, now you have to actually start paying off the loan. There are several factors involved in like your interest rate, payment schedule monthly, weekly and your paying back period, which is the amount of time you have selected to pay back the mortgage.
Be PITH Safe
According to the Canadian Housing & Mortgage Corporation, your monthly housing costs should be less than 32% of your gross monthly income. These are careful your PITH or Principle and Interest Property Tax, and Heating bills.
Get a Mortgage Afford
If you pass the PITH test, the next test of what you can afford mortgage-wise is that your whole monthly debt load car payments, credit card debt ext should be less than 40% of your gross monthly income.
Picking the Right Interest Rate
Your interest rate at which you select to pay off your mortgage varies from “fixed” whereby the rate will NOT change for the term of the mortgage, and is normally a higher but considered more stable or variable whereby the interest rate can vary with the present state of the market.
Finally, owning a home can really be an amazing thing. Thankfully there are many resources out there to help make the process a smooth one like mortgage brokers so remember, you are never alone through this intimidating process.
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