Assets

PREPARING YOUR FINANCES Assets

Lenders will verify that the funds you are using for your down payment are in a liquid (readily available cash) account, like a checking or savings account. Lenders may also want to see proof that you have a “financial cushion” to handle emergencies or unforeseen expenses. As a rule of thumb, you should have 2 to 3 months of house payments in your checking or savings account after closing on your home.

Aside from getting your paperwork ready for your lender, you’ll also want to make sure you know your maximum monthly house payment – including your mortgage, property taxes, and insurance. We recommend that your mortgage, insurance, and taxes combined should stay between 25-30% of your monthly income after taxes.

Most importantly – your monthly house payment should fit into your budget. Don’t just take your approved amount as your shopping limit. Look at your finances and do your own math to see if you can afford the monthly payment.