Final answer:
A mortgage is the primary way to finance the payments when you are buying a home and cannot pay the full price upfront. A typical down payment is about twenty percent of the home's cost, with the rest covered by the mortgage. Calculating how much you can afford to pay periodically is crucial for financial stability.
Step-by-step explanation:
If you wish to buy a home but cannot afford to pay the full price immediately, a mortgage is the primary way to finance the payments. When you use a mortgage, you are essentially taking out a loan to purchase a home, agreeing to pay back the loan amount plus interest over a set period. A down payment is typically required, which is usually around twenty percent of the home's purchase price. For example, if you are buying a house that costs $100,000, you would typically put down $20,000 and take a mortgage for the remaining $80,000. It's important to understand how much you can afford to pay each period to calculate a maximum loan amount and avoid the financial strain of overcommitting to a loan.