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Subject Expert
They will pre-qual you to a max. Then it’s up to you to determine what you can actually afford on a month to month basis
Subject Expert
Like the max that a bank will lend to you based on their risk formulas. Generally they will approve you for an amount higher than you can actually afford to (based on needing to save and emergencies and such)
Well yes they are a good first stop and can give you actual guidance. But at the end of the day it’s buying a house, not turning in a 3rd grade assignment. You need to be the one who calls the shots and draws the line on how much is too much. Simple budgeting on how much you’d like to pay per month is the first thing you need to wrap your head around. I remember my first house the mortgage broker told me I could get up to like a $1.2M house if I wanted to, but obvs you never max that out and he was very clear that he was not suggesting I buy up to that limit and I walked him through how much I was willing to put down vs pay monthly and he guided me to what my actual budget was of $550-650k and that was perfect ammunition to begin my housing search.
Everyone has a different take. Honestly most brokers in these markets give more or less the same rates. And to get that estimate (anything beyond just what the Google mortgage calculator would give you) you need to submit a bunch of paperwork to each broker. I was recommended two good brokers from a really good friend who had expertise in real estate and I submitted my documents to both of them and only cared to have a deep discussion with one of them afterwards around what I could actually afford since they were both good and going to tell me the same thing.
If you’re just starting out, I’d suggest first reviewing your current income and expenses (excluding housing), then take 70-80% of the remainder (rest will be savings). That 70-80% is what you can spend on housing. Keep that in your back pocket, and then approach lenders. This will give you a framework to assess the lenders.
Where are you located? Shoot me a DM, happy to help or answer any questions about the process.