Letâs look at a hypothetical spontaneous chemical reaction: The quantity of usable energy (chemical potential) in a reaction is called the Gibbs Free Energy (DG). DG is the difference between the energy contained in the products of a reaction and the reactants: DG = (energy of products) - (energy of reactants)
That's why some financial experts feel it's more realistic to think in terms of your net income, aka take-home pay, and that you shouldn't use any more than 25% of your take-home on your mortgage payment.
Down payment. You can often get the best mortgage rates by paying a higher mortgage down payment. Down payments can range anywhere from 0% to 20% or more of the total cost of the home. 15% to 20% is ideal. Paying mortgage points up front can also help lower your payments and interest.