Understanding ‘Disposable Income’ and How This Will Impact Your Mortgage Approval

There are few things more exciting than finding your ideal home, but with the rising cost of housing, a person’s dream home can often come with a very high purchase price. If you’re wondering how much home you can truly afford and how your cost of living will fare for your mortgage approval, here are some of the details on what you can expect when it comes to finding a home at an affordable price.

What Is Your Debt-to-Income Ratio?

Before deciding if a home is right for you, it’s important to calculate what your debt-to-income (DTI) ratio is to determine how much house you can afford. The debt amount will include any credit cards, existing mortgages and other loan payments that you pay down each month. To determine your maximum monthly payment, multiply your gross income by 0.36 and divide it by 12. This will give you the expenditure of debt, including your housing payment, that you should not exceed each month.

Determining Your Down Payment

There’s a lot of talk around the ideal amount you should put forward for a down payment, but this percentage can directly impact the amount of the house you can afford. If you are able to put down 20% of the purchase price of your home, this means your monthly mortgage payments will be minimized and this will decrease your DTI ratio. While a home may be out of your reach if you can only put 10 or 15% down, 20% down will ensure a higher amount of disposable income on a monthly basis, making your application more feasible.

Determine Your Lifestyle

While a lender may not reject your application outright if your debt-to-income ratio is higher than suggested, it’s important to know what kind of spending choices make sense for you so that you can make your monthly payments. If you have limited expenses above your mortgage and enjoy a Spartan lifestyle, it’s entirely possible that you’ll be able to manage a higher monthly amount. However, if you don’t have stable employment and are struggling each month, it may be a good idea to consider a less expensive property.

The monthly mortgage payment for your dream home may look like it’s manageable on the surface, but if your DTI ratio exceeds what is suggested, there may be issues with acceptance of your application. If you’re currently in the market for a new home, give me a call for more information – J.P. Cook – 602-320-4253.

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12007 W Southern Avenue Tolleson, AZ 85353

$1,150,000

4 Beds

3.5 Baths

3,000 SqFt

Status Active

MLS # 6594950

Property Type Single Family Residence

Price Type --

Welcome to your new 4-bedroom home, with an expansive 2.229-acre lot! A large driveway with an RV gate & RV parking leads you to a 3-car side garage and laundry room with lots of storage. All-encompassing interior features, fireplace in the living & dining room for a warm & inviting ambiance. Wide open kitchen for entertaining, Granite countertops in ample chefs' kitchen with large island granite counters throughout, a built-in desk, a travertine backsplash, gorgeous cabinetry, a center island w/breakfast bar accentuating the flexibility of the space. Large custom granite dining table. Split 4-bedroom plan with open family/dining area offers direct access to the backyard, a master walk-in closet, & a spa-like ensuite. The ensuite includes dual sinks, an enclosed rain shower and soaking claw tub, dual sink vanities, a separate tub and shower. This home has beautiful floors, 10ft ceilings, 8ft solid wood knotty Alder doors, ceiling fans & recessed lighting. Spacious bedrooms & large ample closets. Don't let this rare property pass you by! Buyer and Buyers Agent to verify, all facts, figures and zoning.

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11626 S Appaloosa Drive Phoenix, AZ 85044

$1,150,000

5 Beds

3 Baths

3,649 SqFt

Status Active

MLS # 6669571

Property Type Single Family Residence

Price Type --

Located in the Equestrian Estates Custom home neighborhood. Original Owner, the home has been meticulously maintained and updated, Great mountain views from both levels. Footsteps away from hiking and biking in the desert preserve. Large backyard for entertainment and family activities. Mature citrus trees. Recently remodeled pool and deck. Newer roof, well insulated home for energy savings. newer Trane variable speed hvacs. Custom knotty alder cabinets and doors, new floors, kitchen and master bedroom/bath remodel, ionization water system, new paint, bar in family room, propane fireplaces in family room and master suite. ceiling fans throughout, Open floor plan, great neighborhood. Location, location, location!

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1484 Creekview -- Prescott, AZ 86305

$1,150,000

3 Beds

4 Baths

3,040 SqFt

Status Active

MLS # 6776198

Property Type Single Family Residence

Price Type --

Discover luxury living at its finest in this exquisite single-level home, perched in the prestigious Southview community & offering breathtaking views of the Granite Dells & the National Forest. This highly desirable Santa Fe-style residence, with extensive upgrades & a spacious 3+ car garage, is ready for you to make it your own. From the moment you step inside, you'll be captivated by the soaring ceilings & a wall of windows that frame the stunning, sweeping views. Designed for entertaining, the gourmet kitchen features a gas cooktop, two full-size ovens, rich wood cabinetry, granite countertops, & a center island with a breakfast bar. A generously sized walk-in pantry adds ample storage space. The unique dining room, featuring a pergola-style surround, is perfect for entertaining. In addition to this elegant space, the home offers a breakfast bar, a cozy breakfast nook, and an impressive patio with a large Kiva fireplace, providing multiple options for both indoor and outdoor dining experiences. Each bedroom boasts its own ensuite bathroom, ensuring privacy and comfort. The master suite is the epitome of luxury, with a private gas fireplace, access to one of three outdoor patios featuring a serene water feature tucked among the boulders for ultimate privacy. The ensuite bath is equally impressive, featuring a soaking tub, custom tile walk-in shower, dual vanities with vessel sinks, dual walk-in closets, and a skylight that bathes the room in natural light. The 3-car garage comes complete with a workbench and extra storage. This home is filled with high-end finishes and thoughtful details throughout, embodying true luxury. To ensure the panoramic views remain unobstructed, the owners purchased the property in front, preserving this magnificent outlook just for you. With so many features to offer, this exceptional home is best experienced in person to fully appreciate its beauty and the unparalleled vistas.

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22020 E Stoney Vista Drive Queen Creek, AZ 85142

$1,150,000

3 Beds

2.5 Baths

2,474 SqFt

Status Active

MLS # 6691837

Property Type Single Family Residence

Price Type --

This horse property is nestled on just under 2 acres of land! The home features 3 BR plus an office & 2.5 bathrooms. Cozy up by the wood-burning fireplace in the spacious living area, highlighted by vaulted ceilings. The split floor plan offers privacy, while the attached 2-car garage provides convenience. Step outside to a large covered patio, perfect for enjoying the serene surroundings. The property also boasts a 1350 sq foot detached shop/4-car garage, covered RV parking, additional covered parking, and separate storage. For your equine friends, there's a lot to love: the irrigated lot features a tack room with electrical, a hay shed/barn, round pen, and 2 covered stalls. Located near the Horseshoe Park & Equestrian Center, Schnepf Farms, and several golf courses, you'll enjoy easy access to shopping and dining at Queen Creek Marketplace, the Legacy Sports Complex and the Phoenix Mesa Gateway airport. Don't miss this opportunity to own your own piece of paradise in Queen Creek Arizona.

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8921 E Nora Circle Mesa, AZ 85207

$1,150,000

4 Beds

2.5 Baths

2,993 SqFt

Status Active

MLS # 6693228

Property Type Single Family Residence

Price Type --

People come to Arizona looking for its beauty: the desert landscapes, the abundant wildlife, sunsets to inspire the soul, and a beautiful home that fits perfectly into that setting. This home is a wonderful example of that ideal Arizona home. Located in the east valley near the Superstition mountains in a gated and upscale community within East Mesa and near Las Sendas golf course community, this is a fantastic find whether looking for a home to vacation to, move to, retire to, or just escape to. With soaring ceilings, a chef's kitchen, a primary suite to dream of, and that resort-style backyard you've hoped for, this is one not to be missed. New price and seller wants it sold! Located on a full-de-sac street surrounded by stunning homes in a fantastic neighborhood, this home welcomes all. The large living area greets you upon entrance and immediately shares a spectacular view of the backyard. The formal dining area, currently featuring a piano and large wine fridge, is a wonderful hosting space to keep as is or reimagine. The kitchen is the showpiece of this home with its 6-burner cooktop, cafe-style fridge, beautiful cabinetry, granite countertops, and much more. The first guest bedroom opens to a private lanai, while the other guest bedroom and den (formerly the 4th bedroom) are perfect for visiting company, a home office, kid's rooms, or much more. The split floor plan features a primary suite with its own living space and spacious bathroom to add to the scale of the home. A large walk-in closet, separate shower, and soaking tub complete the reward for the owners. A 3-car garage which is always in demand features ample storage, a workbench, and pull-down attic access for additional space. And then there's that backyard...Wow. With separate grill, bar seating (complete with beverage fridge), retractable awning, patio, fire pit, and salt-water pool all in a serene desert setting, you have one of the types of homes you've been searching for. Moments from the lakes, rivers, mountains, hikes, and beauty that is Arizona, this is a home that would cost twice as much in Scottsdale, Cave Creek, or other outlying areas. And only minutes to Sky Harbor, it's certainly a location that those who have found appreciate and share only with those in the know.

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1905 N Calle Maderas -- Mesa, AZ 85213

$1,150,000

6 Beds

5 Baths

4,263 SqFt

Status Active

MLS # 6785889

Property Type Single Family Residence

Price Type --

Custom 6 bdrm/5 baths on 1/2 acre lot in gated enclave of 36 homes. 7 car garage. Mature citrus. Flood irrigation. Split floorplan. Wood shutters. Oak flooring. Workshop. 3 fireplaces.

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7646 E Miami Road Scottsdale, AZ 85258

$1,150,000

3 Beds

3 Baths

2,608 SqFt

Status Active

MLS # 6764337

Property Type Single Family Residence

Price Type --

Resort style Sandpiper! Soaring ceilings, neutral paint, with carpet and tile throughout. Open concept, upgraded kitchen feature white cabinets, stainless steel appliances, large center island/breakfast bar. Tons of cabinet space. Each bedroom is very spacious with sliding glass doors to your patio. SANDPIPER is a 24/7, resort style, guard gated community in the heart of SCOTTSDALE with 7 pools! It is surrounded by McCormick Ranch Golf Course and has easy access to restaurants, shopping, the greenbelt, Old Town, Fashion Square and more....

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11722 S 38th Avenue Laveen, AZ 85339

$1,150,000

4 Beds

4.5 Baths

3,408 SqFt

Status Active

MLS # 6721960

Property Type Single Family Residence

Price Type --

This exquisite mountain estate is a home unlike any other in the area. Situated in one of the city's highest points, in an exclusive community on 1 ACRE of land. The interior has porcelain tile flooring throughout, soaring vaulted ceilings in the great room, and 10-foot ceilings elsewhere. Each of the 4 generous bedrooms features its own private ensuite bathroom and walk-in closets. Two large covered patios equipped with surround sound and misting systems. The large backyard provides the perfect canvas for a pool, a casita or other improvements. Additional features include an oversized 3-car garage, RV gate and a small open workshop.

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10860 E Cactus View Circle Gold Canyon, AZ 85118

$1,150,000

3 Beds

4 Baths

3,661 SqFt

Status Active

MLS # 6757807

Property Type Single Family Residence

Price Type --

Enjoy breathtaking views of the Superstition Mountains from this beautifully upgraded 3 bed / 4 bath home. Designed for multi-generational living or perfect for having friends & family stay comfortably in their own private guest quarters. The open floor plan features a Great Room with hardwood floors, a stunning stone fireplace, & sliding glass doors on either side to provide seamless indoor/outdoor living & tons of natural light. The kitchen is a chef's dream w/ solid cherry cabinets, marble countertops, a Wolf 5-burner cooktop, double ovens, & multiple refrigeration options. The spacious island is perfect for entertaining. The main living area includes a large office (easily converted to a bedroom) w/ built-in solid cherry cabinetry & desk. The hall bath has a travertine shower, glass sink & wall faucet. The primary suite is a spacious & bright private oasis. The primary bath has travertine flooring, dual travertine sinks, dual shower w/ bench seating, jet tub, & private toilet room. Walk into your custom closet, designed by Classy Closets, w/ plenty of built-in storage. Bedroom 1 has sliding glass doors to the front patio-courtyard & a spacious walk-in closet, and bedroom 2 has sliding glass doors to the back patio & en-suite bath. The Main living area has a 2-car garage & the attached flex space also has its own 2-car garage w/ a workshop that is temperature controlled. Can be used for rental, in-law, or guest quarters, w/ its own living room w/ fireplace, full kitchen, and spacious bedrooms. Flex space features wood plantation shutters, solid cherry cabinets, Maytag double oven glass top stove, Fisher & Paykel dishwasher, & efficient washer & dryer, & jacuzzi bathtub. This single-story home is fully equipped with owned, automated solar (21kW) & three AC units. The expansive backyard features natural desert landscaping, a fire pit, and extensive covered patios. This property is zoned for two horses. You'll fall in love with the views and the endless possibilities this home offers!

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3648 E Arabian Drive Gilbert, AZ 85296

$1,150,000

4 Beds

3 Baths

3,461 SqFt

Status Active

MLS # 6736773

Property Type Single Family Residence

Price Type --

Step into unparalleled elegance with this stunning residence, where sophistication meets comfort in every detail! Excellent curb appeal with striking stone detailing, a manicured front yard, a 3-car tandem garage, and an inviting front porch. Double doors open to a welcoming foyer leading to the formal living room! The great room is bathed in natural, recessed, and chic light fixtures, illuminating every corner. High ceilings, soothing paint tones, beautiful wood-plank tile flooring, and multi-sliders to the back patio are features you'll love. Meticulous attention to detail is presented in the upscale kitchen, fully equipped with a gas cooktop, double wall ovens, and a sizable island with a breakfast bar. Gleaming quartz counters, stylish tile backsplash, a walk-in pantry, and a plethora of white cabinetry with crown molding elevate the space. Explore a spacious bonus room ideal for a hobby or entertaining space! Find your sanctuary in the grand main suite, showcasing a soft carpet, a sitting area, a full ensuite with dual sinks, a step-in glass shower, a separate tub, and a walk-in closet. Discover the highlight of the outdoor space: a stunning crystal blue pool, the perfect oasis for those scorching summer days! Hurry! This gem will not disappoint!

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48842 Riviera Place Ehrenberg, AZ 85334

$1,150,000

3 Beds

4 Baths

4,192 SqFt

Status Active

MLS # 6737737

Property Type Single Family Residence

Price Type --

Don't miss out on an exceptional opportunity to own a riverfront home in Arizona! This stunning home offers ample space for relaxation and comfort. Situated on the Colorado River, this property features breathtaking views from every angle. The fully finished basement provides additional living space perfect for entertaining or unwinding. Step outside to your own private putting green and incredible outside kitchen and bar perfect for gatherings with friends and family. The home comes fully furnished with high end finishes throughout. Located in an exclusive gated community, you'll have access to a private boat ramp and your own private dock. This home has an elevated boat garage and offers the ultimate in riverfront living. Come and live your best life on the river!

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7525 E Gainey Ranch Road Unit 188 Scottsdale, AZ 85258

$1,150,000

2 Beds

2 Baths

2,047 SqFt

Status Active

MLS # 6759996

Property Type Single Family Residence

Price Type --

Welcome to Gainey Ranch Greens! beautiful community of single family homes, choice lot with no home behind you, 2 bedrooms and den -SINGLE LEVEL home with vaulted ceilings & split floor plan, vaulted ceilings, 2 fireplaces, spacious kitchen with breakfast area opens to family room, charming backyard BBQ station, 2 side yards and lovely plantings, close to the community pool. Enjoy access to all of the best Gainey Ranch amenities including the incredible recently remodeled clubhouse, heated pool & spa, pickle ball courts, tennis courts, and state of the art fitness center! 24 hour guard gated entry - this is the perfect winter getaway or year-round home!

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