In order to make a decision about buying a home, you have to get a good handle on your current financial situation. This involves understanding in great detail all of your cash inflows and outflows each month. Knowing this will help determine what house payment you can comfortably afford each month. In addition to cash flow, you need to know your debt to income ratio. This involves tallying all your assets and liabilities.
At RealtyCrunch, we've developed this handy worksheet to help you figure out all your income and expenses. It's easy to remember things like groceries and rent, but other expenses are once a year, like renters insurance, or property taxes and you'll not want to exclude those.
Remember to only include expenses that will be there after you purchase your new home.
The goal of the worksheet is to give you a picture of your monthly expenses and your debt to income ratio so you can make any changes if necessary to help improve the quality of your home purchase!
Click on the excel sheet below and try it!