Suze Orman Fan Club Blog Community

If you’re looking for answers about how big a house payment you can afford, who do you call? Suze Orman. Although it might be totally against what your lender tells you, Suze Orman advises that if your current monthly rent is $1,000 then the best realistic route would be to take that rental amount and add 45 percent to it. This would give you a total of $1,450. So what is Suze actually saying here? Well, although she might be going round the houses what she is saying is that if you cannot afford a basic principal-and-interest house payment of $1,000 then you should lower your housing budget and expectations. Suze suggests that the 45 percent extra will encompass your property insurance, property taxes, private mortgage insurance (where applicable), and monthly maintenance costs. Suze discusses this in further detail in her book “Money Book for the Young, Fabulous, & Broke”. This also covers extra payments for utilities and other costs incurred at your new home.

Although your Real estate agents, rich friends, and perhaps your parents will try to persuade you into purchasing a larger house right now their well meant philosophy is that during the years to come your income will increase and you will find the mortgage gets easier to manage. However that puts more stress on you and it is less stressful to buy a house that allows you the chance to breathe. If you are successful in your career and can afford a more expensive house in a few years then that is the time to buy.

Visit Mickie at either of her Today.com blogs, The Osbourne’s or her blog about the Performing Arts.

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