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

[Anonymous]

I'm still processing the OP's stated goal of saving $125k for each kid for college... does the OP have any idea about the cost of attendance for college these days and the anticipated trajectory? Or are they planning to cash flow tuition?

[Anonymous]

Anonymous wrote:I'm still processing the OP's stated goal of saving $125k for each kid for college... does the OP have any idea about the cost of attendance for college these days and the anticipated trajectory? Or are they planning to cash flow tuition?

Oh god, only $125K? The horror.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:It's risky but you will at least be better positioned to sell with a rate that high. This forum is filled with people who are trapped in their 2% mortgage that will never be able to sell.

That doesn’t make any sense. People with 2% mortgages are equally able to sell as people with 6% mortgages, they just have more incentive not to. No one is trapped.

Most people with 2% mortgages will downsize if they sell and buy a new house. The jump in rates and increase in prices make it impossible for a lot of people. There are always plenty of posts in this forum of people saying they feel trapped and can’t afford to move.

The first post in this chain said OP is better positioned to sell with a $950k mortgage at 6% than if they had a $950k mortgage at 2%. Actually, they’re in the same position to sell, the person with the higher percentage has just been paying way more money in the interim. You’re saying that the person who doesn’t want to give up a lower rate is trapped when they’re actually just making a rational economic decision.

No. The first post said if the OP buys a house now with a 7% mortgage and then needs to sell, they'll be better off than someone who is currently in a house with a 2% mortgage. I'm saying the person with the lower mortgage is in a much tougher position because due to the increase in rates and housing prices since they bought their home, they'll end up paying significantly more for the same house.

[Anonymous]

I wouldn’t, but I’m also not from one of those UMC DCUM families who are underwriting all sorts of things.
One neighbor, after having trouble finding a new job, went to work for his mom; another neighbor was just gifted a new addition with screened porch from their inlaws because they felt cramped after baby #3.
So if you’re from one of these, you’re fine. If you’re like me, where family on either side does not or actually cannot help with housing, childcare/education expenses, or employment in any way, even in a rough patch, don’t do it. We’re HHI $300k, totally on our own, two kids, mortgage of $600k, and have peace of mind financially - it’s completely managable.

[Anonymous]

For us, the issue is that taxes and insurance keep going up. By a lot.

[Anonymous]

Anonymous wrote:I wouldn’t, but I’m also not from one of those UMC DCUM families who are underwriting all sorts of things.
One neighbor, after having trouble finding a new job, went to work for his mom; another neighbor was just gifted a new addition with screened porch from their inlaws because they felt cramped after baby #3.
So if you’re from one of these, you’re fine. If you’re like me, where family on either side does not or actually cannot help with housing, childcare/education expenses, or employment in any way, even in a rough patch, don’t do it. We’re HHI $300k, totally on our own, two kids, mortgage of $600k, and have peace of mind financially - it’s completely managable.

Just know that you are in an extremely frugal minority. Do a search on Redfin for $1 million dollar SFHs in North Arlington, McLean, Vienna, Falls Church City and anyplace in MoCo zoned for the “W Schools” and BCC. You will pull up only a handful of homes. I can guarantee you that the average family who is buying these $1 million dollar 1,500 sq ft homes that need a lot of work is not a partner at a law firm. A $300,000 HHI would be the norm for a home like this.

By your frugal logic, people with HHIs of $300,000 should be buying SFHs in Cheverly, Woodbridge, Manassas, and Wheaton…that is, places where you can still find SFHs for $600,000. I can promise you the average family in these areas is not pulling in $300,000 a year. You would feel very out of place sending your kid to Kennedy or Wheaton HSs making $300,000.

[Anonymous]

OP, yes, if you like the house,I would prob do it. We bought our 725k house when we made 250k combined. No family help - at all - but we are very thrifty and had in savings apx 1m. It was a stretch for several years and then got much easier as our jobs changed and earnings increased.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I wouldn’t, but I’m also not from one of those UMC DCUM families who are underwriting all sorts of things.
One neighbor, after having trouble finding a new job, went to work for his mom; another neighbor was just gifted a new addition with screened porch from their inlaws because they felt cramped after baby #3.
So if you’re from one of these, you’re fine. If you’re like me, where family on either side does not or actually cannot help with housing, childcare/education expenses, or employment in any way, even in a rough patch, don’t do it. We’re HHI $300k, totally on our own, two kids, mortgage of $600k, and have peace of mind financially - it’s completely managable.

Just know that you are in an extremely frugal minority. Do a search on Redfin for $1 million dollar SFHs in North Arlington, McLean, Vienna, Falls Church City and anyplace in MoCo zoned for the “W Schools” and BCC. You will pull up only a handful of homes. I can guarantee you that the average family who is buying these $1 million dollar 1,500 sq ft homes that need a lot of work is not a partner at a law firm. A $300,000 HHI would be the norm for a home like this.

By your frugal logic, people with HHIs of $300,000 should be buying SFHs in Cheverly, Woodbridge, Manassas, and Wheaton…that is, places where you can still find SFHs for $600,000. I can promise you the average family in these areas is not pulling in $300,000 a year. You would feel very out of place sending your kid to Kennedy or Wheaton HSs making $300,000.

Yes, we are in the frugal minority. Why? Because, as stated and you seem to have missed, ain’t nobody going to help us if we falter. We don’t have a family safety net. That’s the whole point. Others in our income bracket can afford to be less frugal because they could be underwritten by family if they lost their house, or are already unwritten by family in a million less dramatic, invisible ways that they are usually oblivious to. Careful frugality as the only way to survive life’s crises isn’t always lurking in the back of their minds. Shoot, I have friends who moved in with family while doing a voluntary gut remodel of their dream home, which the parents also helped fund. This is amazing for them. This is the sort of support I would love to offer my kids one day. But there is not one variable of that vignette that applies to me or my spouse. So we save and spend and make choices as if we have no backup, because we don’t. It’s so out of touch that you’re criticizing me for being frugal.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I wouldn’t, but I’m also not from one of those UMC DCUM families who are underwriting all sorts of things.
One neighbor, after having trouble finding a new job, went to work for his mom; another neighbor was just gifted a new addition with screened porch from their inlaws because they felt cramped after baby #3.
So if you’re from one of these, you’re fine. If you’re like me, where family on either side does not or actually cannot help with housing, childcare/education expenses, or employment in any way, even in a rough patch, don’t do it. We’re HHI $300k, totally on our own, two kids, mortgage of $600k, and have peace of mind financially - it’s completely managable.

Just know that you are in an extremely frugal minority. Do a search on Redfin for $1 million dollar SFHs in North Arlington, McLean, Vienna, Falls Church City and anyplace in MoCo zoned for the “W Schools” and BCC. You will pull up only a handful of homes. I can guarantee you that the average family who is buying these $1 million dollar 1,500 sq ft homes that need a lot of work is not a partner at a law firm. A $300,000 HHI would be the norm for a home like this.

By your frugal logic, people with HHIs of $300,000 should be buying SFHs in Cheverly, Woodbridge, Manassas, and Wheaton…that is, places where you can still find SFHs for $600,000. I can promise you the average family in these areas is not pulling in $300,000 a year. You would feel very out of place sending your kid to Kennedy or Wheaton HSs making $300,000.

PP here. I said our mortgage is 600k. House is $800k. Mortgage and house sale amount are different numbers. Well, they are if you are a frugal outlier, apparently.

[Anonymous]

No, I would not. We had very similar numbers when we bought a home last year. Our mortgage is $650K. You can find a home where you need less than a $950K mortgage OP. It just won't be brand new.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I wouldn’t, but I’m also not from one of those UMC DCUM families who are underwriting all sorts of things.
One neighbor, after having trouble finding a new job, went to work for his mom; another neighbor was just gifted a new addition with screened porch from their inlaws because they felt cramped after baby #3.
So if you’re from one of these, you’re fine. If you’re like me, where family on either side does not or actually cannot help with housing, childcare/education expenses, or employment in any way, even in a rough patch, don’t do it. We’re HHI $300k, totally on our own, two kids, mortgage of $600k, and have peace of mind financially - it’s completely managable.

Just know that you are in an extremely frugal minority. Do a search on Redfin for $1 million dollar SFHs in North Arlington, McLean, Vienna, Falls Church City and anyplace in MoCo zoned for the “W Schools” and BCC. You will pull up only a handful of homes. I can guarantee you that the average family who is buying these $1 million dollar 1,500 sq ft homes that need a lot of work is not a partner at a law firm. A $300,000 HHI would be the norm for a home like this.

By your frugal logic, people with HHIs of $300,000 should be buying SFHs in Cheverly, Woodbridge, Manassas, and Wheaton…that is, places where you can still find SFHs for $600,000. I can promise you the average family in these areas is not pulling in $300,000 a year. You would feel very out of place sending your kid to Kennedy or Wheaton HSs making $300,000.

DP here with similar stats. We live in Rockville and do not feel the slightest out of place. We are also not raging snobs.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:It's risky but you will at least be better positioned to sell with a rate that high. This forum is filled with people who are trapped in their 2% mortgage that will never be able to sell.

That doesn’t make any sense. People with 2% mortgages are equally able to sell as people with 6% mortgages, they just have more incentive not to. No one is trapped.

Most people with 2% mortgages will downsize if they sell and buy a new house. The jump in rates and increase in prices make it impossible for a lot of people. There are always plenty of posts in this forum of people saying they feel trapped and can’t afford to move.

The first post in this chain said OP is better positioned to sell with a $950k mortgage at 6% than if they had a $950k mortgage at 2%. Actually, they’re in the same position to sell, the person with the higher percentage has just been paying way more money in the interim. You’re saying that the person who doesn’t want to give up a lower rate is trapped when they’re actually just making a rational economic decision.

No. The first post said if the OP buys a house now with a 7% mortgage and then needs to sell, they'll be better off than someone who is currently in a house with a 2% mortgage. I'm saying the person with the lower mortgage is in a much tougher position because due to the increase in rates and housing prices since they bought their home, they'll end up paying significantly more for the same house.

Ok… if you had the choice to get a 2% mortgage or a 7% mortgage, would you choose the 7% so you’re in a better position to sell in the future? You’re saying the person with a higher opportunity cost against selling is in a tougher position to sell when really they just have more reason not to. They aren’t actually worse off.

[Anonymous]

That is just really tight, and for our family would be very stressful. Like, I would be stressed about groceries, paying for activities, etc. with that type of mortgage on that income. Plus, property taxes just go up by thousands over a few years in this area.

[Anonymous]

Be prepared for that $7700 figure to become $8800 within 5 years. The increase of insurance and property taxes is very real and happens to everyone living close-in.

[Anonymous]

Anonymous wrote:I'm still processing the OP's stated goal of saving $125k for each kid for college... does the OP have any idea about the cost of attendance for college these days and the anticipated trajectory? Or are they planning to cash flow tuition?

Not OP, but personally I’m not planning on spending more than that for college. You all can continue to pretend you have no choice but to piss your money away to these increasingly unjustifiably expensive college degrees, but I’m not going to pay more than is actually reasonable. Looking at each kid starting off at community college and then transferring.