“How much can I borrow?” is the first thing you need to think about when buying a home. Mortgage lenders consider several factors, such as your income, the property’s value, and their assessment on your ability to repay the loan.

Online calculators can compute this. They determine the maximum monthly payments on mortgage and the qualified maximum loan amount.

Lenders will look at three things to determine how much you can borrow:

• Income

• Property value

• Ability to repay the loan

Your income will give lenders an idea as to how much will go to monthly payments on mortgage (front-end ratio). Your payment— principal and interest— should not be more than 28% of your gross monthly salary. Lenders also consider other debts such as car loans, credit card payments, and child support (back-end ratio) that must not exceed 36% of your gross income.

You can easily get a loan with a regular income and a clean credit history.

Lenders will also look at property values. The loan to value (LTV) ratio or the relationship between the property’s actual value and your loan amount is important. If you’re looking for a loan of $200,000 on a house worth $400,000, there is a 50% LTV rate. A high LTV rate means more risk for the lender. Most lenders loan up to 75% of the property’s value. They will also assess your ability to afford the loan by checking your average bills and other expenses.

Seek the help of experienced mortgage advisors to get accurate results. This will keep you from thinking “how much can I borrow?”