Do you know if you’re qualified to get secure a loan for your dream home? Being prepared is a difficult task (especially after the mortgage crisis) but it’s not impossible. First time home buyers should be aware that banks look at many things other than your credit score and how much money you make. Depending on your credit score (some lenders will allow a higher percentage from borrowers with a great score) many lenders are looking to see that your monthly payments are between 28% to 44% of what you take home, anything more than this (with fair to average credit) is called being overextended. Since this blog is about ALL THINGS financial, I’ll help you do the calculations necessary to determine if you’re overextended or not. To determine if you’re overextended you need to total up your monthly payments (Student Loans, Car Loans, Utilities, etc) and divide that by what you take home each month. The number might surprise you, or it may upset you. If you’re in the clear then you’re well on your way to acquiring a mortgage for the home of your dreams. If you’re one of the many that are upset about your status, don’t fret. If you’re reading this post you’re probably thinking about buying a home and may also be prepared for a situation such as this. Utilities can be adjusted (change to a basic cable package, be ever mindful of the thermostat and be extremely energy conscious, change your phone plan for something a little more affordable). Pay more towards your credit card bills and if you’re able to pay one off, pay that amount towards your next account and so on (but don’t close those accounts)! In closing, the dream of owning a home is reachable for anyone, proper planning and necessary sacrifices can make that dream a reality!