Family First
Family First
Menu
Family First
Family First

Certificates of Deposit are currently not appearing in Home Banking and our Mobile App. Our vendor is aware of this and is working to fix the issue. We apologize for any inconvenience this may cause.

Hours Changes: Beginning the week of Jan. 4, 2021, the Penfield Branch and the Call Center will be closing at 5:00 pm on Fridays and the Henrietta Branch will be closed on Saturdays.

How to Determine How Much House You Can Actually Afford

Last Updated

August 24, 2020

Written By

First Family Credit Union

Questions to Ask for First-Time Home Buyers 

Purchasing a house is one of the biggest and most important purchases in a person’s life. The median down payment made by first-time homebuyers is around $5,129 versus repeat homebuyers at $22,008. Figuring out your budget and how much to spend on your first home is the first step. Here are some ways to get started on your homebuying journey. 

 

Steps to Taking the First Leap 

1. Create a Budget   

Begin your budget by figuring out how much you and your partner or co-buyer are earning each month. This number should include all sources of income and revenue such as alimony, investment profits, rental earnings, and more.  

2. Determine Housing Costs 

After you’ve determined your budget, create a list of housing costs and total down payment. This must include annual property tax, estimated mortgage interest rate, homeowner’s insurance cost, and how long you want to pay off your mortgage. Future homeowners tend to choose 30-year timelines for their loans, but it is also an option to select shorter loans.  

3. Calculate Your Expenses    

Lastly, calculate all of your total expenses. Everything that is spent in a monthly basis is calculated in this total. Accuracy plays a crucial role in this step, as it can determine how much you can truly afford when purchasing a home. 

Start your journey by utilizing the Affordability Calculator here. 

Following the 28/36% Rule 

First-time homebuyers can run into financial trouble by maxing out their income to buy their dream-home. It is crucial to make sure that as a first-time buyer that you or your partner have a safety cushion or budget for emergencies and unexpected expenses. 

In order to determine your budget, many financial advisors suggest that buyers should spend no more than 28 percent of their monthly gross income on housing expenses and no greater than 36 percent in total debt such as student loans, car expense, credit card payments, and more. By following the 28/36% rule, it allows for a baseline on how much you can truly afford.  

Let’s Help One Another 

Family First Credit Union is here to help when you’re ready to take the first steps in purchasing your first home. Speak with one of our experts today!  

Looking for More Articles?