Plan 1 Year Ahead Before Purchase

Dated: 01/21/2016

Views: 328

It is never too early to start planning for the most important investment of your life. Thats why I always tell my renters PLAN AHEAD . This means Start fixing your credit because the better your score , the lower rate you get on your loan . The Debt to income Ratio score determines everything in todays market.

A debt-to-income ratio is one way lenders measure your ability to manage the payments you make every month to repay the money you have borrowed. 

To calculate your debt-to-income ratio, you add up all your monthly debt payments and divide them by your gross monthly income. Your gross monthly income is generally the amount of money you have earned before your taxes and other deductions are taken out.  For example, if you pay $1500 a month for your mortgage and another $100 a month for an auto loan and $400 a month for the rest of your debts, your monthly debt payments are $2000. ($1500 + $100 + $400 = $2,000.) If your gross monthly income is $6000, then your debt-to-income ratio is 33 percent. ($2000 is 33% of $6000.)

Thats why its very important , to pay off the credit cards , car notes . and any loans you have outstanding . Start your purchase on a clean slate. Without loans with have no house . Hope this is helpful.


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