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You may know someone who lost a home to foreclosure, but you might not know all the ins and outs of the process.

When the lender takes back a property after the mortgage has gone unpaid for a specified period of time, that’s a mortgage foreclosure. The process varies by state and by lender, but there are things you can do to avoid it.

Here’s what you need to know about foreclosure and moves you can make if you’re facing it.

What Does Foreclosure Mean?

When a buyer finances a home, the home mortgage loan is secured with the property, meaning the property is used as collateral on the loan. If the homeowner fails to make the agreed-upon payments on the due dates, the lender can take the property back. This is why it’s so important to think about what ifs as you go through the mortgage prequalification and mortgage preapproval process. How would you keep up payments in the event of a job loss? Do you have an emergency fund in place?

Each state has its own laws regarding foreclosure and its own state foreclosure rate. Where you live will determine how properties are foreclosed. There are two main types of mortgage foreclosure.

Recommended: Help Center for Mortgages

Types of Mortgage Foreclosure

In some states, the lender is required to go through the court system to foreclose on a property. This is known as judicial foreclosure. In other states, the lender does not have to go through the court process.

Judicial

With a judicial foreclosure, a lender must get a court order to foreclose on a property. The lender must file a complaint with the court, which is also sent to the homeowner and any other lienholders. Generally, the mortgage note must also be filed with the court.

Some states require loss mitigation efforts before a suit can be filed, meaning the mortgage servicer must work with the borrower to help them avoid foreclosure. Most of these foreclosures are not contested, resulting in a default judgment against the homeowner.

After this, the property may be scheduled for sale (usually a foreclosure sale or sheriff’s auction). The homeowner may appeal the foreclosure judgment.

Nonjudicial

In a nonjudicial foreclosure, deeds of trust can be foreclosed without going through the court system. Lenders must give special notice to the property owner and wait a specified amount of time before auctioning the property off.

Some states allow both judicial and nonjudicial foreclosure, while others may only allow one or the other. Below is a summary of states and what process they follow for mortgage foreclosure.

When Does Mortgage Foreclosure Begin?

Mortgage foreclosure begins with the first missed payment, though a lender’s actions will escalate the more payments a homeowner misses. With the first missed payment, the mortgage lender won’t take the property back, or even issue a notice of default, but will reach out to the borrower to help them get payments back on track.

The lender will also report a nonpayment or late payment to the credit bureaus and issue a late fee.

Typically, lenders won’t issue a notice of default until the borrower defaults on three missed payments, or 90 days past due (this is standard practice, but lenders can issue a notice of default sooner than 90 days). Default is the precursor to foreclosure.

Recommended: Home Loan Help Center

Foreclosure Timeline: How Long Does Mortgage Foreclosure Take?

Once the notice of default arrives after 90 days past due, the time it takes to complete the foreclosure will vary by state. In some states, it can be a matter of months. In others, much longer. In the last quarter of 2024, the average time a property took to complete foreclosure was 762 days.

In jurisdictions where each step of the process requires court approval (judicial foreclosures), court backlogs can delay the foreclosure processes for years.

Why Do Foreclosures Happen?

Foreclosure occurs in a number of situations. Some of the most common:

•   Being underwater. When a homeowner has negative equity in the home, the property is more likely to be foreclosed on. Having an underwater mortgage is the most common reason for foreclosure.

•   Rising interest rates. When a borrower’s loan has an adjustable interest rate, a sudden rise in the amount owed each month can lead down the path to foreclosure. With the 5/1 ARM, for example, the interest rate is fixed for the first five years and then adjusts once a year.

•   Mortgage types. Sometimes even the different kinds of mortgages can contribute to default. With an interest-only mortgage, for instance, after five or 10 years of interest payments, principal and interest kick in, resulting in higher payments.

•   Personal situations. When the payment on a mortgage loan becomes too much or when a life event (hospitalization, death, divorce, layoff) prevents homeowners from making monthly payments, they can slip into default and eventually foreclosure.

If the homeowner doesn’t work with the lender to make a plan for repayment of the missed payments, the mortgage servicer can seek foreclosure.

Can You Avoid Foreclosure?

Homeowners have options if they’re facing foreclosure, and the sooner they contact their mortgage lender or servicer, the more they will have. Some of these include:

•   Reinstatement. If you’re able to pay off the past due amounts and any penalty fees, the lender will stop the foreclosure process.

•   Repayment plan. A repayment plan allows you to tack on a portion of your past-due payments to your regular payment each month. This makes sense if you’ve only missed a small number of payments and will no longer have trouble making a monthly mortgage payment.

•   Forbearance. If you qualify for mortgage forbearance, your lender might pause or lower monthly mortgage payments for a short amount of time. When you start making payments again, you’ll add portions of your missed payments to your regular payment to catch up.

•   Loan modification. With a loan modification, the lender permanently alters the terms of the mortgage contract, so the payment is more manageable. This can include a reduced interest rate, adding missed payments to the loan balance, extending the term of the mortgage, or even canceling part of the mortgage debt.

•   Filing for bankruptcy. Filing for Chapter 13 bankruptcy may allow you to keep certain assets like a house or car. A court must approve your repayment plan. It stays on your credit report for seven years. You might want to consult with a bankruptcy attorney if you’re thinking about going this route.

•   Selling your home. If you have enough equity in your home to pay off the mortgage and pay for the cost of selling your home, you may be able to sell your home to avoid foreclosure.

•   Deed in lieu of foreclosure. A deed in lieu of foreclosure is essentially when you hand over the title of your home to the lender instead of going through a foreclosure. It is less damaging to your credit than a foreclosure. (Note: SoFi does not offer a Deed in Lieu at this time.)

•   Short sale. If the lender agrees to a short sale, it is agreeing to allow the home to be sold for less than what is owed. The deficit is taxable if the mortgage terms hold the borrower liable for the full amount of the loan.

Recommended: A Guide to Mortgage Relief Programs

Consequences of Foreclosure

Foreclosure has a huge impact on your credit. It will stay on your credit report for seven years after the first missed payment, and the multiple delinquent payments are a further knock against your credit scores, making it hard to go shopping for another mortgage and other loans.

After a foreclosure, it could take two to seven years to get a new conventional or government-backed mortgage.

But there are ways to deal with financial hardship. And a key first step where foreclosure is concerned is to reach out to your mortgage servicer and discuss a plan.

The Takeaway

Facing mortgage foreclosure is one of the toughest things a homeowner can go through. As the financial landscape shifts, knowledge is power. Foreclosure can be avoided if you work with your mortgage servicer and get help managing your debts. With time and a disciplined strategy in place, you can get on a solid financial footing again.

Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.

FAQ

Can I stop the foreclosure process?

Possibly. The sooner you contact your mortgage servicer, the more options you will have.

How will foreclosure hurt my credit score?

The lender reports each missed payment, and the further behind a borrower gets, the more delinquent they become. The credit score lowers with each report. A foreclosure stays on a credit report for seven years, which makes it harder to apply for other credit lines and loans.

Am I supposed to pay property taxes when my house is in foreclosure?

It’s true that a missed tax payment can also lead to foreclosure proceedings, but it depends on where you are in the process. If you’re working with your lender to get your missed payments back on track to avoid foreclosure, then your escrow account will be replenished and the mortgage servicer will pay your taxes. If you’re in foreclosure and not able to get your payments back on track, paying your taxes won’t help you get your house back. You’re better off working with your lender to put that money toward missed mortgage payments.

Do I have to move out of my house when it is in foreclosure?

The Federal Trade Commission advises staying in the house as long as possible if you’re facing foreclosure. You may not qualify for certain types of assistance if you move out.

Photo credit: iStock/jhorrocks

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility-criteria for more information.

*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

This article is not intended to be legal advice. Please consult an attorney for advice.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

SOHL-Q125-032

Private airport lounges offer a comfortable refuge from crowded waiting areas by your flight’s gate. They’re a place to recharge (yourself and your devices), have a glass of wine, and sample upscale prepared foods that are a major improvement over that bag of chips from the vending machine.

These facilities are typically only accessible via a pricey plane ticket or membership. Here, you can learn ways to enjoy luxury airport lounges, for a fee or possibly even for free, including by accessing credit card rewards.

How Do Airport Lounges Work?

There are several types of airport lounges, and they vary from basic to luxurious. The no-frills lounges simply have snacks and drinks, while the most lavish ones will feature such complimentary perks as a full buffet, table-service restaurant, open bar, and even showers. The seats are typically way more comfortable than what you find in the standard waiting area, and you may have your choice of reading materials and streaming shows.

Not only can this help fill the time before your flight, but it can save money on food in the airport or onboard your flight, which can be one way families can afford to travel.

If you are traveling with pets, you may find a lounge that allows you to hang out with little Bailey in less crowded conditions than the main terminal. This can be more comfortable for you and your furbaby.

There are a few main types of lounges:

•   The original airport lounges are those run by the airlines, and several major carriers still offer lounges at the airports they use as hubs. In the U.S., American, Delta, and United offer large lounge networks, while Alaska Airlines has a much smaller network. Some foreign carriers also offer lounges at major international gateways, such as New York’s JFK and Los Angeles.

•   Another type of airport lounge is the contract lounge. These are third-party facilities that are open to those who have membership with an affiliated network. These lounges are also used for business and first-class passengers of airlines that don’t have their own branded lounge. In the U.S., the most common lounge network is Priority Pass Select, which offers members access to over 1,700 “airport experiences” around the world. There are numerous travel rewards credit cards that offer a Priority Pass Select membership.

•   You’ll also see lounges that are branded with the name of a credit card issuer, for use by its premium cardholders. The American Express Centurion lounges are the largest credit card lounge network. Capital One and Chase are also in the process of constructing their own branded lounge network. These lounges tend to be the most luxurious.

•   Finally, there are USO lounges that are available to U.S. Armed Forces active duty, Reserve, and Guard service members, as well as their families.

How to Access Airport Lounges for Free

With most lounge networks, the easiest way to gain entry is to purchase a membership or a day pass. However, there are some ways to access airport lounges without forking over cash.

Open a Premium Travel Rewards Credit Card

There are several travel credit cards that offer the perk of airport lounge access. For example:

•   The American Express Platinum Card offers lounge membership with the Delta SkyClubs, Plaza Premium, Priority Pass, American Express Centurion lounges, and others.

•   The Chase Sapphire Reserve offers Priority Pass and Chase Sapphire Lounge memberships.

•   The premium airline credit cards from American, Delta, and United each offer membership to their branded lounges.

When you’re deciding about which credit card rewards are most valuable to you, consider whether luxury airport lounge access is an important factor.

Recommended: How Does Credit Card Travel Insurance Work?

Trade in Miles or Use Credits

Another way to enter fancy lounges for free is to redeem airline miles for a membership (you might also be able to redeem credit card miles vs. cash back to gain access). For example, you can redeem 85,000 United miles for a United Club membership, rather than paying the $650 annual fee. Since you are receiving less than one cent in value per mile redeemed, this is considered a poor use of your miles, but no judgment. If it works for you, go for it!

Fly in Business Class or First Class

When you have a ticket in business class, first class, or international first class, most airlines will give you a pass to an airport lounge. It could be a lounge branded by that airline, especially in their main hubs. But if you are traveling from a city with little service on that airline, you’ll likely get a pass to a contract lounge.

Befriend a Business or First Class Passenger

One of the great things about flying in business or first class is that you will often receive a lounge pass that includes guest access. So if you are flying in economy class but have a friend or colleague with a business class ticket, he or she may be able to “guest” you into the lounge either for free or at a reduced rate.

Claim Free Access for Active Military

If you’re an active duty member of the U.S. military, then you may have free access to some lounges. For example, both United and American offer free access to active duty military personnel and their families. However, they may require that you be in uniform and traveling on orders.

Recommended: Do You Need a Credit Card to Rent a Car?

Access Airport Lounges for a Fee

If you’re unable to access an airport lounge for free, you might consider paying for it. Here are some ways to do just that:

Buying an Airport Lounge Pass

Airport lounge memberships are available for sale, either through an airline that brands the lounge, or through a network such as Priority Pass Select. Memberships generally start at a few hundred a year, but discounts are available for those with elite status in the airline’s frequent flier program. If you’re saving up for a few upcoming flights, you might also consider stashing away the price of a lounge pass where you keep a travel fund.

Buy a Day Pass

Many lounges (but not all) offer day passes that can typically cost $25 to $80 per person. Some online platforms and apps may sell discounted access to certain airport lounges. Depending on your situation — how much time you have to fill before your flight, whether you’re hungry or thirsty, whether you need a quiet place to work — this might be a good buy.

Upgrade Your Ticket

If you are on an international flight and are seated in business or first class, then you’ll already have access to the lounges. But rather than pay full price for these tickets, you may be able to book a less pricey class of service and then buy up to business class at check in, perhaps for just a few hundred dollars. Doing so will also result in a pass to the airport lounge.

Recommended: Understanding Purchase Interest Charges on Credit Cards

The Takeaway

When you have to spend time in an airport waiting for your flight, the lounge can be a comfortable place to do it, with comfortable seating, free food and drinks, and other amenities that can make killing time feel luxurious. While it can be expensive to buy membership to a lounge, you may be able to access a luxury airport lounge for free, especially if you have the right credit card. Or you might be able to buy your way in for a modest fee by purchasing a day pass or trying another smart-traveler tactic.

Whether you're looking to build credit, apply for a new credit card, or save money with the cards you have, it's important to understand the options that are best for you. Learn more about credit cards by exploring this credit card guide.

FAQ

Is it worth it to pay for airport lounge access?

If you’re taking a short trip and you want to arrive at the airport as close to departure as possible, then there’s no reason to pay for airport lounge access. But if you have a long layover in the middle of a trip or a long flight ahead, then lounge access can be worth paying for. Also, under certain circumstances, such as needing to finish a work deliverable before your flight, a luxury airport lounge can be a much more comfortable place to work.

Which airport lounges are the best?

International first class lounges, where available, are often the most luxurious. The American Express Centurion lounges are also known to feature gourmet food and drinks. Some Priority Pass Select lounges have well-regarded food options, while others are pretty basic. Domestic airline lounges can be pretty spartan.

Which credit card is best for airport lounge access?

The decision of which credit card is best for airport lounge access will depend on personal preference but two options are well-known. The American Express Platinum Card offers access to Delta SkyClubs, Priority Pass Select, and American Express Centurion lounges. The Sapphire Reserve Card offers a Priority Pass Select membership that also includes credits at select airport restaurants, as well as access to its own branded lounges.

Photo credit: iStock/andresr

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

This content is provided for informational and educational purposes only and should not be construed as financial advice.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

SOCC-Q125-044

An income of $200,000 a year puts you in a good position to afford a home priced at $600,000. But whether you should aim higher or lower than this in your house hunt will depend on your debt, how much you’ve saved for a down payment, and current interest rates, among other factors. Read on for a breakdown of the variables that could affect how much of a mortgage you can manage.

What Kind of House Can I Afford with $200,000 a Year?

Not so very long ago, if you’d asked someone: “If I make $200,000 a year, how much house can I afford?” they probably would have said, “A mansion!” Of course, that isn’t necessarily true anymore. But that income still can get you a pretty sweet home in most places.

You can get an idea of how much house you can afford on a $200,000 income by using an online mortgage calculator or by prequalifying with one or more lenders for a home mortgage loan. Or you can run the numbers yourself using a calculation like the 28/36 rule, which says your mortgage payment shouldn’t be more than 28% of your monthly gross income, and your total monthly debt — including your mortgage payment — shouldn’t be more than 36% of your income. Let’s take a closer look at what could affect how much you can borrow and what your payments might be.


💡 Quick Tip: Not to be confused with prequalification, preapproval involves a longer application, documentation, and hard credit pulls. Ideally, you want to keep your applications for preapproval to within the same 14- to 45-day period, since many hard credit pulls outside the given time period can adversely affect your credit score, which in turn affects the mortgage terms you’ll be offered.

Understanding Debt-to-Income Ratio

You can expect lenders to look carefully at your debt-to-income ratio (DTI) — the second number in the 28/36 rule — when they’re deciding how much mortgage you can afford. It tells them how you’re handling the debt you already have and if you can manage more.

Your DTI ratio is calculated by dividing your total monthly debt payments by your monthly gross income. Mortgage lenders generally look for a DTI ratio of 36% or less; but depending on the lender and the type of home loan you’re hoping to get, you may be able to qualify with a DTI up to 43% or even 50%.

Typically, the lower your risk, the better your borrowing options. So if you want the best loan amount, rate, and terms, you’ll want to keep an eye on this number.

Your Down Payment Also Can Affect Costs

You may not need a hefty down payment to qualify for some home loans. But the more you can comfortably put down on a house, the less you’ll have to borrow, which can help lower your monthly payments. And if you put down at least 20%, you can avoid paying private mortgage insurance (PMI), which will further reduce your payments.

Other Factors that Can Affect Home Affordability

Your income, debt, and down payment are all primary factors in determining how much house you can afford. But there are other things that also can affect your ability to qualify for a mortgage that’s manageable, including:

Interest Rates

A lower mortgage interest rate can significantly lower your monthly payment — and the amount you’ll pay for your home over time. While interest rates are relatively consistent across the market, lenders do compete for customers, so you may benefit from shopping around. You also can help your chances of qualifying for a better rate by making sure your finances are in good shape and you have a solid credit score.

Loan Term

The most common mortgage term is 30 years, but different loan lengths are available depending on the type of mortgage you choose — and each has pros and cons. If you’re deciding between a 15-year vs. a 30-year mortgage, for example, the shorter term may offer a less expensive interest rate, which could save you money over the life of your loan. But the 30-year term will likely have lower monthly payments, which may be a better fit for your budget.

Homeowners Insurance

Understanding how to buy homeowners insurance and comparing the policies available may help you minimize this expense. Lenders require borrowers to have an adequate amount of homeowners insurance, and if you live in a state that’s considered “high risk,” the cost of coverage could be significant.

HOA Fees

If you’re buying in a community with lots of amenities, homeowners association (HOA) dues could add a substantial amount to your monthly home costs. (The monthly average is about $250, but fees can go as high as $2,500 or more.)

Property Taxes

Property taxes, which are generally based on the assessed value of a home, are often included in a borrower’s monthly mortgage payment, so it’s important to include this amount when you calculate home affordability. (Check your county’s website for the correct number.)

Location

If you’re a fan of real estate shows like House Hunters, you already know the city or even the particular neighborhood you want to live in can be a big factor in determining how much house you can afford. The overall cost of living can vary by state, and costs are also typically higher in cities vs. rural areas. If you aren’t willing to compromise on location, you may have to increase your housing budget to buy in the area you want.

Recommended: Best Affordable Places to Live in the U.S.

How to Afford More House with Down Payment Assistance

If you have the means to manage a higher monthly payment but you need some help with your down payment, there are state and federal down payment assistance programs that can help.

Many programs set limits on how much an eligible home can cost, or on the homebuyer’s income. But it’s worth checking out what’s available to you — especially if you live in a state with higher home values. In California, for example, where homes can be expensive, a first-time homebuyer with a $200,000 income still can qualify for assistance in some counties.

Home Affordability Examples

With a home affordability calculator, you can get a basic idea of how much house you can afford by plugging in some basic information about your income, savings, debt, and the home you hope to buy. Here are some hypothetical examples:

Example #1: Saver with a Little Debt

Annual income: $200,000

Amount available for down payment: $80,000

Monthly debt: $650

Mortgage rate: 6.5%

Property tax rate: 1.125%

House budget: $700,000

Example #2: Less Debt, But Also Less Savings

Gross annual income: $200,000

Amount available for down payment: $20,000

Monthly debt: $200

Mortgage rate: 6.5

Property tax rate: 1.125%

House budget: $605,000

How You Can Calculate How Much House You Can Afford

Along with using an online calculator to figure out how much house you might be able to afford on a $200,000 income, you also can run the numbers on your own. Some different calculations include:

The 28/36 Rule

We already covered the 28/36 rule, which combines two factors that lenders typically look at to determine home affordability: income and debt. The first number sets a limit of 28% of gross income as a homebuyer’s maximum total mortgage payment, including principal, interest, taxes, and insurance. The second number limits the mortgage payment plus any other debts to no more than 36% of gross income.

Here’s an example: If your gross annual income is $200,000, that’s $16,666 per month. So with the 28/36 rule, you could aim for a monthly mortgage payment of about $4,666—as long as your total debt (including car payments, credit cards, etc.) isn’t more than $6,000.

The 35/45 Model

Another DIY calculation is the 35/45 method, which recommends spending no more than 35% of your gross income on your mortgage and debt, and no more than 45% of your after-tax income on your mortgage and debt.

Here’s an example: Let’s say your gross monthly income is $16,666 and your after-tax income is about $13,000. In this scenario, you might spend between $5,833 and $5,850 per month on your debt payments and mortgage combined. This calculation gives you a bit more breathing room with your mortgage payment, as long as you aren’t carrying too much debt.

The 25% After-Tax Rule

If you’re worried about overspending, or you have other goals you’re working toward, this method will give you a more conservative result. With this calculation, your target is to spend no more than 25% of your after-tax income on your mortgage. Let’s say you make $13,000 a month after taxes. With this method, you would plan to spend $3,250 on your mortgage payments.

Keep in mind that these equations can only give you a rough idea of how much you can spend. When you want to be more certain about the overall price tag and monthly payments you can afford, it helps to go through the mortgage preapproval process.

Recommended: 2024 Home Loan Help Center

How Your Monthly Payment Affects Affordability

Some eager homebuyers can tend to put most of their focus on a home’s listing price or the interest rate. But it’s how those factors and others combine to raise or lower the monthly payment that can ultimately determine whether a buyer can afford the home or not.

Before signing on the dotted line, it’s a good idea to run the numbers on an online mortgage calculator to be confident you can stay on track.

If you do find yourself struggling a bit — perhaps because your income changes or an unexpected life event occurs — refinancing to a new loan with a lower payment may be an option. (Especially if interest rates drop.) But how soon you can refinance may depend on the type of loan you have.

Types of Home Loans Available to $200,000 Households

A $200,000 income can go a long way toward helping a buyer qualify for certain mortgage options, such as a conventional or jumbo loan. But a higher salary also could make you ineligible for a government-backed loan that has income limits. There also may be limits on the purchase price and type of property, depending on the mortgage you get.

Here are a few of the options that may be available to $200,000-income households:

Conventional Loans This loan is issued by a private lender, such as a bank, credit union, or other financial institution.

FHA loans Insured by the Federal Housing Administration, FHA loans are a good resource for borrowers with a lower credit score or little money available for a down payment. There are no limits on how much you can earn and get an FHA loan, but there may be a limit on how much you can borrow depending on where you plan to reside.

VA loans A loan guaranteed by the U.S. Department of Veterans Affairs is an excellent option for eligible members of the U.S. military and surviving spouses. There are no income limits on VA loans, and there are no longer standard loan limits on VA direct or VA-backed home loans.

USDA loans These loans are guaranteed by the U.S. Department of Agriculture and are meant to help moderate- to low-income borrowers buy homes in eligible (typically rural) areas. Loan limits and income limits are based on the home’s location.


💡 Quick Tip: Keep in mind that FHA home loans are available for your primary residence only. Investment properties and vacation homes are not eligible.

The Takeaway

There are several variables that factor into how much home you can afford. Besides your income, lenders will look at your credit, your debt, and your down payment to determine how much you can borrow. To find a loan and monthly payment that’s a good fit for you, it’s a good idea to research and compare different loan types and amounts. And, if you have questions, you can seek advice from a qualified mortgage professional.

Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.

FAQ

Is $200,000 a good salary for a single person?

According to the Census Bureau, only 11.5% of U.S. households earned $200,000 or more in 2022. So, if you’re earning $200,000 all on your own, you could say you’re doing pretty well.

What is a comfortable income for a single person?

“Comfortable” is a subjective term and can vary from one person to the next. For some people comfortable means being able to buy what they want. For others it means crafting and following a careful budget so that they know where their money is going each month.

What is a livable wage in 2024?

The Massachusetts Institute of Technology’s Living Wage Calculator lists living costs across the U.S., and its “livable wage” varies widely based on family size and location. For a single person with no children in Napa County, California, for instance, the living wage is $21.62 per hour. In Boone County, Nebraska, it’s $14.93 per hour.

What salary is considered rich for a single person?

The top 5% of earners made, on average, $335,891 in 2021, the most recent year for which data is available, according to the Economic Policy Institute. (If you feel as though you have to be in the top 1% to be “rich,” you’d have to earn $819,324 or more.)

Photo credit: iStock/YvanDube

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility-criteria for more information.

*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

^¹FHA loans are subject to unique terms and conditions established by FHA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. FHA loans require an Upfront Mortgage Insurance Premium (UFMIP), which may be financed or paid at closing, in addition to monthly Mortgage Insurance Premiums (MIP). Maximum loan amounts vary by county. The minimum FHA mortgage down payment is 3.5% for those who qualify financially for a primary purchase. SoFi is not affiliated with any government agency.
^†Veterans, Service members, and members of the National Guard or Reserve may be eligible for a loan guaranteed by the U.S. Department of Veterans Affairs. VA loans are subject to unique terms and conditions established by VA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. VA loans typically require a one-time funding fee except as may be exempted by VA guidelines. The fee may be financed or paid at closing. The amount of the fee depends on the type of loan, the total amount of the loan, and, depending on loan type, prior use of VA eligibility and down payment amount. The VA funding fee is typically non-refundable. SoFi is not affiliated with any government agency.

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