The first thing you need to determine is how much you can spend on your new home. The amount that you can borrow will generally depend on four main factors:
- The size of your down payment
- Your credit score
- Your debt-to-income ratio (DTI) and
- Your monthly maintenance expenses
All of these factors will impact the interest rate you can obtain from your lender and the size of your monthly payment, which should correspond with your overall cash flow so that you can continue to live without feeling like you are chained to your new home (house rich and cash poor).