You've decided that you are ready to purchase the South Carolina home of your dreams.  But, can you afford to buy right now?  There are several factors you must take into consideration when determining how much home you can afford.

Employment - Have you been at your current job for more than a couple of years?  What is your income?  With unemployment hovering around 10% across the country, lenders want to know that you will be able to make your monthly payments for the next several years.  

Your Credit Score - Credit scores range from 300 to 850 (perfect credit).  Your payment history with any car loan, student loan, credit card, etc that you have ever had over your entire adult life is calculated into an algorithm by the credit reporting agents to determine what your credit score is.  The higher your score, the better risk you are.  This means that you can borrow higher amounts of money at lower interest rates.  You are legally entitled to 1 free copy per credit reporting agency per year (Equifax, TransUnion and Experian).  If you don't know what your current credit score is, you should request a copy of your report today.

Your Dependents - Are you currently responsible for any children or older parents?  Tuition, day care and/or medical bills should be factored into your South Carolina house budget. 

Location - Home prices can vary not only from city to city, but from neighborhood to neighborhood as well.  A 2000 square foot home in one area can cost much more than the same home in another.

Your Savings - It is highly recommended that you put at least 20% of your South Carolina home's price as a down payment.  This means that, for a $200,000 home, you would need to have $40,000 as a down payment.  In addition to the down payment, you will need money for closing costs and the normal repairs and maintenance that homeownership typically entails. 

Interest Rates - As of the writing of this post, the 30-year fixed rate is around 4.8%.  That means that, if you can afford to buy a South Carolina home, now is a fantastic time to do so.  Again, check your credit score to see if your credit is good enough to be approved at the lowest rates available.

If you are in the market to purchase a home in the future, these are the things you need to consider in determining how much home you can afford.  BankRate.com provides a wonderful Mortgage Calculator to help you decide what your budget is.  You can always contact me for your South Carolina real estate needs as well.  I'm ready and willing to help you out!

Gene Mock, your Northern Virginia and South Carolina real estate specialist