Calculate how much house you can afford.

The subprime mortgage craze, which resulted in so many homeowners being forced into foreclosure or bankruptcy, was caused in large part because people were told not to consider how much house they could afford!   They were told to look at how much mortgage they could get.   That worked fine for the seller, the mortgage broker and the real estate brokers who got rich from people buying homes they couldn't afford.

For the novice homeowner, however, it meant working multiple jobs, giving up anything in their life that cost money, including eating out and taking vacations, and still not being able to afford the mortgage, taxes, insurance, upkeep and other expenses that they never even considered. Home ownership is the American Dream.  However, for those who did not take a realistic look at what they can afford, it become their llving nightmare.

Many websites have excellent calculators that help you to see generally how much house you can afford. One of the best is the CNNMoney calculator.   It is easy to use: