You should only get a mortgage you can afford. Lenders don't hand out mortgages like candy the way they did in the early 2000s, but some lenders can still approve you for more house than you should get. If you don't want to wind up as another foreclosure fatality, know how much you can manage before you take further steps on your mortgage search.

## Calculate 28 Percent

Visit your bank or credit union to determine how much of a loan you can get. Consider that figure, and then do your own calculations, too. Your mortgage payment should not be more than 28 percent of your gross annual income. For example, if you and your partner's combined annual pretax income is \$100,000, you figure that 28 percent of 100,000 is 28,000. Divide that by 12 to determine that you should not pay more than \$2,333 per month for your mortgage. But that's not all. You have more costs associated with a mortgage than the mortgage itself. Include homeowners insurance fees, private mortgage insurance that you pay if you put less than 20 percent down on your mortgage and until your home equity is 20 percent, property taxes and, in some cases, association fees. These fees, combined with your mortgage, should not be more than 32 percent of your gross annual income, or \$2,667, using the \$100,000 example.