While shopping for an Atlanta new home is a very exciting process, you need to know not only how much you can afford in a mortgage, but how much mortgage you can afford to pay month to month, including all the costs of homeownership. The Equifax Finance Blog has a new article with an accompanying video to help you understand the costs, ”

How Much Can I Afford to Spend on a Mortgage?”

While your lender will look at your gross monthly income to figure out how much you can afford, and generally will advise somewhere between 28 to 36 of your income on housing depending on how much debt you have, you will want to consider more or less to suit your lifestyle and expenses. You will also want to account for three things:

  • Taxes – taxes are relatively easy to prepare for, as the property tax rate, or millage, is set in each of Georgia’s counties. Determine the assessed value of your home (this will hopefully go up each year as your home appreciates in value) and the millage rate and go from there.
  • Insurance – insurance costs can vary greatly based on the type of coverage you have, so you may want to talk to your insurance agent before you get your perfect price set up. In addition, if you choose a home in a flood area, you will have to pay additional premiums.
  • Maintenance costs – if your home’s community has a Homeowner’s Association (HOA), you’ll need to plan on paying HOA fees plus any emergency repair costs and when necessary, landscaping costs. These costs can add up and hit you hard if you have to make major repairs or a renovation all at once, so you may want to set aside a certain amount each month, just like you would for an emergency fund. Decide how much that should be and factor it in to your monthly payments.

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