top of page

I Make $90,000 a Year: How Much House Can I Truly Buy?

How Much House Can I Truly Buy?

Do you make $90,000 or more in a year? Congratulations! According to a recent Census report, you're making almost $20,000 more than the national average salary. If you’re in that income bracket and residing in the beautiful state of Colorado, you might be contemplating a home purchase or refinance. As someone who's been entrenched in the mortgage lending industry for over 30 years, I, Fred Gallegos, want to share some insights that can guide you on this journey.

Automated Underwriting Systems (AUS) and DTI

Before diving into the mortgage basics, it's essential to understand the role of Automated Underwriting Systems (AUS) in today's lending world.

While many think of mortgage applications as a manual process, the modern lending landscape leverages technology like the AUS. This system can speedily and flexibly assess a borrower’s creditworthiness. Over the years, I've seen firsthand how AUS can offer flexibility, especially regarding Debt-to-Income (DTI) ratios, that traditional methods might not.

Having trained many in financial literacy education, I can't stress enough the importance of understanding DTI. Although manual underwriting might have strict DTI standards, an AUS can sometimes approve ratios beyond typical limits, considering other positive aspects of a borrower's profile.

Understanding Mortgage Affordability

For my friends and potential clients in Colorado, here’s a breakdown of what you need to consider:

  1. DTI Ratio: This ratio determines how much of your income is allocated towards monthly debts. A better DTI can lead to improved loan terms.

  2. Housing Budget: Allocate between 28% to 36% of your monthly income towards housing-related costs. Automated Underwriting Systems allow for many to exceed that 36% DTI.

  3. Down Payment: Remember, the more you can put down initially, the better.

  4. The "Hidden" Costs: These include property taxes, insurance, and more.

  5. Credit Score: I've always emphasized the importance of maintaining a solid credit score. It can significantly influence your mortgage rates.

  6. Pre-Approval: A key step to understand your borrowing limit.

  7. Budgeting and Saving: Prepare for the unexpected costs of homeownership.

Achieving Homeownership on a $90,000 Income in Colorado

With your trust, here’s how I recommend making homeownership more attainable:

  1. Budgeting: Knowing where your money goes is essential.

  2. Down Payments: The more you save initially, the better.

  3. Enhancing Credit: Prompt payments and minimizing debts can elevate your credit score.

  4. Reducing Debt: A better DTI can ease mortgage acquisition.

  5. Managing Expectations: Explore Colorado’s diverse real estate options.

  6. First-Time Buyer Programs: Leverage available resources.

  7. Budgeting for All Costs: Plan for both obvious and unforeseen homeownership costs.

  8. Side Incomes: Extra income can offer more financial flexibility.

  9. Consulting Experts: Having mentored many in financial literacy, I always recommend seeking expert advice.

Different Loan Programs in Colorado

It’s also crucial to consider your loan options:

  1. Conventional: A popular choice, usually associated with a 20% down payment if you desire avoiding monthly mortgage insurance premiums.

  2. VA: Tailored for veterans, offering minimal or no down payments.

  3. FHA: Often appealing to first-time buyers due to 3.5% down payment requirements.

  4. USDA: Ideal for those eyeing rural properties with potential zero down payment.

For those of you in Colorado, whether you're looking to purchase a new home or refinance an existing one, my 30 plus years in the mortgage lending industry has provided me with the expertise to assist you in making informed decisions. Start your journey today by getting pre-approved for a mortgage. I’m here to guide and support you every step of the way.

Unlock Your Homebuying Success

Ready to step into Colorado’s real estate market confidently? Let’s create a tailored plan for you. Reach out to me at 970-855-9009.

Contact me today! 📞 Colorado: 970-855-9009 📞 Georgia: 404-985-9980 🌐 Website: 📧 Email: 📅 Schedule a Chat: Let's Connect 📝 Begin Your Application: Apply Now


Disclaimer: Fred Gallegos is a licensed loan originator specializing in the states of Colorado and Georgia and operates this blog as a private individual. While he endeavors to provide the most accurate and up-to-date information, this should not replace official guidelines and regulations.

5 views0 comments


bottom of page