Income For Mortgage Before Or After Tax
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No surprise your net monthly income is usually much lower than your gross monthly income.
Income for mortgage before or after tax. Your net income is that same income after taxes are removed. There s a big difference between your gross income and your net income. Your gross income is the money you earn each month before taxes are removed. The traditional 35 45 model says that you shouldn t spend more than 35 of your pretax income or 45 of your after tax income on your mortgage payment.
You need to have a rough estimate of all of these figures in order to know how much house you can afford and to figure out if you can cover the monthly payments over time. Sounds simple but there s more to it. Rule of thumb says to not have more than 28 of your gross income before tax go toward your mortgage.
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