Financial Budgeting With Your New Mortgage

Financial Budgeting

Financial Budgeting With Your New Mortgage

Planning your budget for a new mortgage will help determine how much house you can comfortably afford. Take some time to research saving opportunities and make sure to have enough money in the bank to cover any extra expenses, and not just your monthly bills. Once you’ve determined your income and spending, you can determine how much your new mortgage might cost you. These tips for a monthly budget can help you move through the buying process while still keeping your head above water.

How Much of Your Net Income to Spend

Make sure to keep things reasonable with your new mortgage. Your mortgage payment, including principal, real estate taxes, homeowner’s association fees, interest, and homeowners insurance shouldn’t exceed 28% percent of your gross monthly income. This is generally the guideline for most lenders. If you multiply your annual salary by 0.28, and then divide it by 12 months, you can calculate your housing expense ratio.

Stick to Your Saving Opportunities

Stick to spending on the basics. Start by breaking down your monthly budget into categories like our must-have essentials, secondary items, and impulse purchases you don’t need. Some life expense examples you can cut back on are:

-Dining out


-Cell phone

-High-end cable channels

-Travel and vacation

-Gym membership


-Take-out food

Household Budget Worksheet

Now that you have you have made a list of things you can cut back, you can budget. Is planning this a little harder than you thought? Stay on top of your monthly budgeting with a household worksheet. Search online for a household budgeting sheets or customize your own with a simple graph in Excel, Word or Google Docs. Input your sources of income and projected spending, including personal expenses. As you track your actual spending, you can revisit your graphs for an accurate monthly budget.

A good budget can really help you not only with your new mortgage and living costs, but also your savings goal. Stick to reality when it comes to your income, how much to spend, and your monthly saving opportunities. Need some advice from our staff? Contact Bank of the Lowcountry, and we can help you with any financial budgeting needs.

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