If you have a commission-based position or if your income fluctuates, it will be essential to determine what your baseline monthly income is before calculating what you can afford.
Determining what you can afford and setting a realistic budget should be the first step in your home buying process. Consider your yearly income and expenses, and how a mortgage will impact these expenses. If you have a fixed income, calculate a reasonable monthly mortgage payment and factor in all the additional expenses that come with being a homeowner like property taxes, insurance, and repairs. If you have a commission-based position or if your income fluctuates, it will be essential to determine what your baseline monthly income is before calculating what you can afford. Online calculators are a helpful tool to estimate mortgage payments, though we always recommend budgeting conservatively because of the associated expenses in buying a home.