Winnebago County Housing Trust--This fund has been established to encourage new construction in Winnebago County. Homebuyers who build in Winnebago County are eligible for a $5,000 forgivable loan when the home is completed. This forgivable loan is not assignable to the builder so the buyer will recieve a 1099 from the county.

Affording Your Mortgage

    Lenders usually use 2 basic formulas to determine how much of a mortgage you can afford. They may vary slightly depending on the lending institution you're using, but all lenders follow the same guidelines. There are many different programs available, both conventional and governmental. Your lender can work with you to find  one that fits your specific financial needs.

    Conventional loans, with a fixed interest rate, generally require that your mortgage expenses, which include the principal, interest, taxes and insurance (PITI) do not exceed 28% of your income. A fixed rate loan has an interest rate which is consistent throughout the loan term. An adjustable rate mortgage (ARM) has an interest rate that fluctuates according to current standards. Mortgage expenses for an ARM are not to exceed 26% of your income. There is another ratio used with long term debt. Long term debt is considered to be any payments extending at least 9 months. Your long term debt must not exceed 36% of your gross income to qualify for a fixed rate loan. For an ARM, your long term debt must not exceed 33% of your gross income. For FHA (Federal Housing Administration) Loans, mortgage expenses are not to exceed 29% and your long term debt to income ratio is to be no more than 41%. For example, if your annual income is $60,000, divide that by 12 and you have a gross monthly income of $5,000. For a conventional loan, you multiply that by 28% which equals $1,400. You should qualify for a conventional loan with payments not in excess of $1,400. The total of your monthly mortgage expense, plus any long term debt must not exceed $1,800. ($5,000 x 36% = $1,800.00)

Determining Net Worth