Would you take a $950k mortgage on 300k salary?

[Anonymous]

I took a $400k mortgage on a $150k salary and I thought that was insane. Sorry OP you guys can't afford it.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My God $950k mortgage!! Can you find a cheaper house?

When you make over $300k a year this is not too much of a stretch. We bought our first house 16 years ago for $500k but times have changed.

I'm sorry it is. We are just addicted to debt in this country. Starting with a $950k mortgage should not be normalized.

Your claim is completely without context.

I'm sorry, but $1m isn't what it used to be.

Better to stretch for a house you want for a long time, than skimp, and have to move at least once, and pay all those transaction costs.

I guess it depends where you live. If starter homes start around $800k in your area then that's a different story. But I am always nervous taking that kind of mortgage because you are then under pressure to always have a high salary. I am a software developer who used to make $300k
I was laid off and it took me a year to find another job and the best I could do was $150k. Thank God I didn't have a house otherwise I would have had to sell.

[Anonymous]

We took a $700k mortgage with a HHI of $175k, though that was at 3% (PITI about $4200). No regrets. Your PITI would be, what $7500? Monthly take home (before savings and health insurance) is about $16k? Leaving you $8500 to live on. Of course you can live on $8500 if you want to.

Here's the thing. Once you've got more than about $100-$200k a year (depending on exact details), you're covering all your basic needs. A small house near-ish to your work, cheap car, utilities/insurance, basic clothes, adequate nutritious food on a reasonable budget, childcare, some savings.

The money above that you can use however you want.

You'd be spending a huge chunk of your additional money on housing. That means you may have to, otherwise, live like someone who makes $150k. That means a grocery budget, cheaper extracurriculars for the kids, limited nights out, local low-cost vacations, clothes from Target, used car you drive for 10 years. If the nicer house is your priority, then that makes perfect sense. Just make sure you realize that if you do that, you're going to be sticking to the basics in other areas. No keeping up with the Joneses. Make a sample budget, and if you're comfortable with it, do it.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My God $950k mortgage!! Can you find a cheaper house?

When you make over $300k a year this is not too much of a stretch. We bought our first house 16 years ago for $500k but times have changed.

I'm sorry it is. We are just addicted to debt in this country. Starting with a $950k mortgage should not be normalized.

Your claim is completely without context.

I'm sorry, but $1m isn't what it used to be.

Better to stretch for a house you want for a long time, than skimp, and have to move at least once, and pay all those transaction costs.

I would agree with this. If we had not bought our house a few years ago when interest rates were lower we would not be able to afford it now.