Do you want to acquire a main residence or make a rental investment? You can get a loan to buy a house. To do this, determine your purchasing budget and your net salary to find out how much to borrow. Currently, this process is becoming more and more difficult to accomplish. Between rising mortgage rates and the wear and tear rate, the ability to borrow is decreasing.
Find out the debt ratio
Knowing how much you can borrow in the amount of 4000 euros per month raises the question of the maximum amount that banks will agree to lend. This is very important, because mortgage credit institutions do not give out more capital than your monthly resources. This standard reassures them of your ability to repay the loans, without the risk of finding yourself in a situation Over-indebtedness.
The first step is to determine your debt ratio (less than 35%). Then calculate your remaining disposable income after paying fees and monthly loan installments. Also consider your personal contribution. To perform a simple calculation, use the following formula:
- Borrowing capacity = net salary (4000€) – monthly fees x 35 (percentage of maximum debt ratio) / 100.
It should be noted that this fee relates to alimony, entitlements of all other credits, running fees, etc.
Know that getting a mortgage with a net salary of 4000 euros is quite possible. There are many loans you can get, such as a zero interest loan, a social housing loan, or a 1% housing loan.
Without taking into account fees or interest rates, monthly loan installments of 4000 euros of salary and 35% debt ratio with a maximum of 4000 / 3 = 1333 euros. Thus, depending on your borrowing profile, you can get a loan of 159,960 euros and 399,900 euros over 10 to 25 years. For more confirmation and to get a clearer idea, run simulations online.