2014 Affordability Snapshot

Let's take a quick look at the affordability of today's housing market. For each of these scenarios we'll assume a pristine credit report, more than two years on the same job, and cash to close belonging to the buyer for at least two months.

For a buyer who can afford to spend about $1100 per month on housing, what does that mean about the purchase price? Programs, rates, down payments, and homeowners insurance have everything to do with monthly payments, so these scenarios are just a ballpark idea of what is currently possible.

When using a VA entitlement for the first time, your purchase price might be $170,000. When using FHA, shop for a price around $150,000. If we still get to use the USDA program after the end of this month, your price might be $160,000. Buying a rental? Maybe $190,000 hits the same payment target. You already know that terms and restrictions will apply.

What's more real than ever is federal oversight about how loans qualify. Debt ratios are tighter, and there is more scrutiny than ever about the flow of money being used to buy a home.

Your best bet, if you think you'll want to buy a home soon, is to get with a mortgage professional long before you call a Realtor or shop for homes on line. Financing is still available for lots of folks, but it's important to know how you fit in the box – or what you need to do to prepare for a formal home loan approval.

Tammy Engel is your local Mortgage Advisor, and has been working for your best interest since 1990. Contact her at 661/822-REAL for help with purchase, refinance, and reverse mortgage.