What you can borrow or what you should borrow?
The amount you can borrow and the amount you should borrow are sometimes two very different things. Before you apply for a home loan, it makes sense to realistically assess your financial situation. Here’s how to do it.
Understand your borrowing capacity
Generally speaking, your borrowing capacity – what you can borrow – depends on a number of factors, including:
your monthly expenses
your existing debts
how much deposit you have saved
current interest rate
type of loan
whether it’s a principal, or principal and interest loan
the term of the loan