 Sam
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 Posted: Fri Apr 09, 2004 12:41 am Post subject: Monthly Income |
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Monthly Income refers to an individual's basic monthly salary, plus any additional allowances and monthly income from investments like Mutual Funds etc.
For example; Let the basic monthly salary of George be $50,000; additional allowances be $10,000 and monthly income from investments be $20,000. Therefore, total monthly income = $50,000 + $10,000 + $20,000 = $80,000
When you apply for a mortgage loan, one of the things that lenders check amongst other factors is your monthly income. This is compared to your monthly expenses to determine the amount of mortgage loan that you can actually afford.
In general, all the lenders agree that your mortgage related expenses in each month should not be more than 28% of your gross monthly income. These expenses include principal loan amount, interest and taxes. Thus, if the combined gross monthly income of a couple is $3,000 then they can afford a maximum mortgage payment of about $840, including taxes and insurance.
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