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.
Last update: June 2013 (includes new FHA rules & rates). When your down payment is less than 20%, you usually have to pay for Mortgage Insurance, (PMI). This protects the lender in case you don't make your house payments, they repossess your house, and they have to sell it for less than the amount left on the loan.our down payment is $10,000 and the morgtage is $190,000. Divide the $190,000 mortgage by 1500 and you get your monthly PMI cost, $127. PMI doesn't change as the outstanding balance changes.