Why Should I purchase a Home?
Purchasing a home can be one of the most rewarding decisions you can make. Though purchasing a home involves many factors, it has several key advantages over renting. For one, homeownership can be a strong investment where, historically, real estate appreciates in value over time. Each monthly mortgage payment you make earns you a greater percentage of, or equity in, your home. You also benefit from federal income tax laws which allow you to deduct mortgage interest paid (a hug chunk of the actual loan), property taxes, origination points, and home buying expenses such as legal fees and administration costs.
Why Should I Purchase a home? How expensive is purchasing a home?
For most people, buying is more expensive than renting, but the tax deductibility of your mortgage expense makes the prospect of owning a bit more practical.
Once you have made the leap and decided that you are going to buy a home, you have to find out what you can afford. That is where we, EW Subprime, come in.
How Expensive Is Purchasing a Home?
For most people, buying is more expensive than renting, but the tax deductibility of your mortgage expense makes the prospect of owning a bit more practical. In general, lenders suggest devoting no more than 30% of your gross monthly income to housing expenses (which typically include principal, interest, taxes, and insurance or PITI).
Monthly Expenditures for Home Purchase
Annual Gross Income |
Monthly Gross Income |
30% of Monthly Income |
$20,000 |
$1,667 |
$500 |
$25,000 |
$2,083 |
$625 |
$30,000 |
$2,500 |
$750 |
$35,000 |
$2,917 |
$875 |
$40,000 |
$3,333 |
$1,000 |
$45,000 |
$3,750 |
$1,125 |
$50,000 |
$4,167 |
$1,250 |
$75,000 |
$6,250 |
$1,875 |
$100,000 |
$8,333 |
$2,500 |
Once you have made the leap and decided that you are going to buy a home, you have to find out what you can afford. That is where we, EW Subprime, come in.
