Most people buying a loft in DTLA have to crunch some numbers to figure out how much home they can afford – even if they’re currently renting, because owners incur different costs than renters do.
So how do you estimate how much house you can afford?
How to Estimate How Much House You Can Afford
Your lender will want to see that less than 43 percent of your income goes toward paying off your debts and other obligations each month. Figure out exactly how much you spend on credit cards, your rent and utilities. Then, figure out how much “wiggle room” you have to reach 43 percent.
You can’t stop there, though.
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Now you have to factor in other homeowner costs, such as:
- Homeowners association fees, if they’re required in the home you want to buy
- Homeowners insurance
- Maintenance for your new home
- Private mortgage insurance, which is only required if you’re putting down less than 20 percent as a down payment
- Property taxes
Owning a home can be much more expensive than being a renter – and that’s mostly because you have to pay for your own maintenance and repairs.
Are You Buying a Loft or Condo in Little Tokyo?
If you’re thinking about buying a condo in Los Angeles or a nearby community, call us at 213-254-7626 or contact us online. While you’re here, check out our: