You have spotted the property of your dreams to 400 000 dollars? Find out how much salary is needed to finance this purchase.
Before any real estate research, it is essential to have an idea of the budget not to exceed. This preliminary step often involves an appointment with the banker who performs one or more simulations. This can also be done online. Explanations.
Estimate your personal contribution and your debt ratio
To determine the amount that can be borrowed from the bank, it is first necessary to determine the available savings and the level of future repayment payments.
Regarding the personal contribution, the bank takes into account the mobilisable savings by keeping a certain margin corresponding most often to the equivalent of 2 or 3 months of income, a sum which remains placed on the savings account to face to an unexpected event.
This contribution is intended to finance the notary fees and the work not financed by the mortgage.
Then, banks usually set a maximum debt ratio of 33%. In other words, monthly payments should not exceed one third of your income. This rule can however be modified according to the situations. When applying for a home loan, the debt ratio is the first element evaluated to inform the borrower of the feasibility of the project, whether it is the purchase of an apartment, a house or good of a rental investment.
This table shows what is the minimum wage to collect to borrow the sum of 400,000 dollars to the bank over periods of 10, 15, 20, 25 and 30 years.
Thus, if your salary is less than 3,366 dollars, it is unlikely that the bank agrees to lend you 400,000 dollars. Indeed, loans over 30 years are rarely offered by banks. Be careful however, in this table, the monthly payments do not take into account the cost of credit and associated banking fees.
Make a real estate mortgage simulation online
To get the exact amount of salary needed to borrow $ 400,000, you need to run a real estate mortgage simulation online . This 100% free tool takes into account several parameters including the existence of one or more credits in progress and allows you to know the exact amount of your future monthly payment based on your current salary.
You want to find a mortgage quickly and at the best rate? By using a real estate broker, you are assured of the best loan conditions. This professional uses his network of partners to negotiate contracts. It can also negotiate credit insurance which represents a major expense item.