Here's a calculator from bankrate.com. If you will need a jumbo loan (over $417K) you'll probably need a 20% down payment to get the best rates which are currently around 7% or a tad over. While not impossible, it's much more difficult today to get a jumbo with less than 20% down.

Once you know how much the new mortgage will cost you can just make the other adjustments.

/tricia

Here is a link that might be useful: bankrate.com

It doesn't matter what you paid for the old house. Selling it for 400K, would leave you 256K after you pay off your 144K mortgage balance. Subtracting 24k (six percent commission) for your realtor will net you 232K.

If the new house cost 570K and you have 10K in closing costs (sounds awfully low to me and the closing costs in NJ where you're planning to buy, and not NY where you will be selling, are what matters), then you will have to get a mortgage for 348K (570K+10K=580K, 580K-232K=348K).

Let's say you get a fixed rate, 30-year mortgage at 6.5%. That means your mortgage payment (principal and interest) would be around $2200/month. To that add about $540 for taxes and you get around $2740/month. That doesn't include insurance.

$6,500 per year in property taxes on a $570k home in NJ sounds very low. I would expect at least double that in most NJ towns. It's possible that the current taxes are based on the last sale price or an old assessment. Just make sure you aren't going to be in for an unpleasant surprise on the taxes after you buy.

Thank you all, for the replies--checked out the site and feedingfrenzy your calculations were pretty spot-on, even after I checked and found the taxes are indeed higher, as richard f guessed: $7,800 a year.

Thanks again.

I've used about 3 of these different "how much home can I afford?" calculators from different websites, and I get a final figure that varies about $40,000. Is there one that's more accurate than the others?

Those calculators are all based on lending guidelines, which vary somewhat, but rarely seem to reflect what people can actually afford. The best thing to do is to sit down and make a detailed monthly budget including what you can afford to spend on a mortgage, insurance and property taxes. Don't forget to include larger utility bills if you are currently in a smaller house or apartment, and don't forget to set some aside for maintenance on the house. Also you might want to think about the fact that taxes don't go down and will likely go up and likely faster than your salary will so you need to factor that in - in 5 years if your taxes go up 10% per year, will you still be able to afford your house if your salary doesn't rise? I would run a few "what if" type scenarios on the taxes to see and make sure that you can afford a reasonable worst case scenario (maybe research what taxes have done the last 5 years to get a better idea).

When you have a number that you can comfortably afford then you can run mortgage payment calculators on houses you are interested in and get an idea of whether you can afford what you are interested in. This is the only real way to know if you can afford a house or not. Just because the lenders will give you money doesn't mean you can afford to pay it back.

Isn't mortgage affordability roughly a maximum of 25% of your net salary or 30% of your gross? Using these calculators is helpful for figuring out monthly payments, but affordability is another matter. I always feel it's most useful to round everything up and not to get too bogged down in figuring things out to the penny -- because a lot of things can change over time.

On the taxes front, something to keep in mind is that in some towns in NJ they use the house sale event to re-assess the house value (may or may not have any relationship to the sale cost) and set new taxes. Rarely does it go down....

threedoghouse is correct. Also, check to see the last time the town had a town wide assesement; if it has been a while that may or may not work in your favor...depending upon how long it has been.

Slightly off topic - just for grins I had a CFP run rough numbers of whether I should take my large chunk of equity and
rent / invest cant remember the return % we used but nothing above 10%
or
buy at 6% fixed with 3% appreciation (lucky around here even before this market)
we estimated property taxes and the tax write=off

I was better renting by 9,000 ???? something like that
I had a gut estimate/feeling but the number was shocking

I asked him to try to give me a better idea, we were doing this pretty fast but still.

"Affordability" is a personal matter. Have you ever sat down and written out of budget? Do you know where all your money goes each month? If you don't know that, all the mortgage calculators are not going to help you determine what you can afford.

What you need to know first, is how much money you have available each month to put towards a mortgage payment, and safety net of savings for increases in taxes, insurance, and unexpected future repairs for the house.

To know how much money you have available, start at the beginning of a month and write down how much money you have coming in during that month: your net pay after all deductions, and then write down EVERY penny you spend during that month. Include all bills, utlilies (will those go up?), pet bills, lattes, food, gas, clothes, movies, DVD's, restaurant, parties, etc.

When you really know how much you spend, then you'll know how much you have available, and can then use the mortgage calculators to get an idea of a mortgage payment that fits your lifestyle.

I'm literly looking at a place right now that I can rent for 1/2 the cost of Mortgage, Interest and Taxes (assuming 100% financing).

So I can afford a lot more house if I rent instead of buy!

Those online mortgage calculators always come back with a higher payment that we could really afford. 25% of take home pay has been a good guide in the past and I think it still is. I know that means housing is unaffordable to some, and unaffordable in some AREAS, but the prices are just too high in most areas now and it needs to come down to earth.

I think the %s are skewed depending on how much you make. For instance if you make $2500 per month, 25% rent (or mtg) will leave you $1875 per month to live on - not so much $$. However if you make $25,000 per month 25% would leave you $18,750 to live on which is a lot. You could probably afford a much higher %. While it's true that the more you make the more you spend - a great deal of the increase is discretionary.

"I'm literly looking at a place right now that I can rent for 1/2 the cost of Mortgage, Interest and Taxes (assuming 100% financing).

So I can afford a lot more house if I rent instead of buy!"

Until the evil landlord raises the rent.