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Most lending professionals recommend that your monthly housing expenses (mortgage payment + property taxes) not exceed 28% of your gross (pre-taxes) monthly salary, or 35% of your post-tax income. Until recently this was all but a rule and mortgage lenders would not lend you more than that, but the most recent real estate run up has led to higher median home prices that no longer make this model feasible in a lot of areas of the Country, and competition in the lending industry has led to capitalization on this fact. Thus, it is not uncommon to be able to obtain financing in which monthly housing expenses are as much as 50% of your monthly income. This is not advisable however, except in extreme cases. To keep from stretching your budget and to reduce your financial risk, it is still recommended that you stay as close to the 28% of gross model as possible.
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