For most people, purchasing a home also means taking out a mortgage loan to pay for it. However, your income and outstanding debt may be limiting the amount of house that you can afford. To increase the amount of home you can afford to buy - there are steps you can take to qualify for a larger mortgage loan.

Quality for Bigger Mortgage by Getting a Co-Signer

Having two sources of income on a mortgage application will help you qualify for a larger loan - so getting someone to be a co-signer on your mortgage can help your cause. Since the co-signer becomes responsible for the entire loan in the event you don't make payments, the co-signer should be someone who is close to you (i.e. relative, spouse, significant other).

Qualify for Bigger Mortgage By Paying off Debt

When a mortgage lender processes your mortgage loan application, it examines all of the debt that you have (i.e. credit cards, car loans, personal loans). The more debt that you have, the less mortgage loan you can afford. If you have extra cash on hand, paying off some of this extra debt may help you qualify for a larger home loan. This may not help in all situations, so consult with a lender to see if this is a viable option for you.

Qualify for Bigger Mortgage Using FHA Loans

Mortgage loans insured by the Federal Housing Administration (FHA) allow borrowers to have more outstanding debt than other types of mortgage loans - increasing the borrowing power for would-be home buyers. There are limits as to the amount you can borrow using and FHA loan - so this may not be an option for very expensive homes.

Qualify for Bigger Mortgage Using Alternative Loans

Fixed rate mortgage loans are the most common types of home loans - the interest rate (and payment) remain the same for the entire life of the loan. Some lenders offer borrowers other types of loan programs that offer a lower interest rate in the early years of the loan, which in turn lower the required loan payment. The lower payments in the early years can allow a customer to borrow more money. Such loans can include balloon loans or adjustable rate mortgages (ARM loans). Since these types of loans can lead to higher interest rates (and monthly payments) in the future, you should consult with a mortgage professional to determine if these loans are a good fit for your needs.