Mortgage – How Much Can I Borrow?

“How much can I borrow” is typically the first question our Frost Mortgage clients ask when applying for a new home loan.

If you were to type “Mortgage – how much can I borrow” in a search engine, the top results generally turn up mortgage calculators and mortgage lead sellers.

Even though an online mortgage calculator may be a good tool for reference, it probably won’t give you the full story about what size mortgage you can borrow.

Banks look at a few things when qualifying a borrower for a new mortgage:

• Credit

The (LTV) is calculated differently depending on whether the new transaction is a purchase, refinance, or rehab loan.

Basically, it is the amount of the new loan in comparison to the total value of the property.

When qualifying for an FHA loan on a purchase, a 3.5% down payment would equal a 96.5% LTV.

Keep in mind that banks will verify a paper-trail of the assets used for the down payment, so it is important to communicate with your loan officer about your current financial position.

There are a few factors to consider when deciding on the amount of your new mortgage:

1. Desired Down Payment

2. Budgeted Monthly Payment

3. Length of time you want to own the property

Since mortgage rates may also have an impact on your monthly mortgage payment, it is important to pay attention to the market.

Schedule a strategy session with our professional Frost Mortgage staff by phone or at a local office to discuss the best lending solution for you and your family.