One Million Dollar house...talk me out of it.

[Anonymous]

we did it but bought new and haven't had any maintenance issues.

We were in the same boat with the same mortgage but a year laster DH got a 25k a year raise which helped.

Hopefully your job is secure like medical, technology or something like that. Those that are paranoid are the ones in fields that are hard to employ or are single income high fields with low job opportunities.

Another food for thought, since the interest rates are so low you will pay a substantial amount down with in a couple of years.

[Anonymous]

Anonymous wrote:We pay $4200 rent on a 180k salary. No daycare but two kids in Catholic school. Its been doable, but only because we are completely forgoing any other expense apart from food and contractually obligated bills. Only reason we're doing it is because it's an 18 month required rotation for my husband to get promoted and the company paid for moving expenses and deposit. If you have the down payment and moving expenses in hand I see no reason why you can't handle that payment on a larger salary.

A word of caution though. In the six months we've been here, the landlords have had to replace two major appliances, deal with tree roots in the plumbing, and remediate an infestation of carpenter ants. The house is only ten years old. The recommended savings rate for house maintenance is 1% of purchase price each year. Will you comfortably be able to save that on top of the sacrifices you will already be making?

Now this is crazy not only for the income and private school but renting at that amount.

[Anonymous]

OP, save a larger down payment and buy a $1 million house when you can put 30% down without tapping into retirement. I'm a little concerned that you haven't saved a larger down payment, it makes me wonder if you know how to budget. No way I'd tap into retirement and wipe out my savings completely to buy a house.

[Anonymous]

Anonymous wrote:OP, save a larger down payment and buy a $1 million house when you can put 30% down without tapping into retirement. I'm a little concerned that you haven't saved a larger down payment, it makes me wonder if you know how to budget. No way I'd tap into retirement and wipe out my savings completely to buy a house.

Sounds like the tapping into retirement was just a bridge loan. But I don't know why they don't just roll the proceeds of their home over into the new house at settlement. The borrowing from retirement seems like an unnecessary step.

[Anonymous]

I know a million sounds like a lot, but if OP is taking an 800K loan on a 300K salary, that's only 2.7 OP's annual income. Not a lot.

[Anonymous]

Anonymous wrote:

Anonymous wrote:OP, save a larger down payment and buy a $1 million house when you can put 30% down without tapping into retirement. I'm a little concerned that you haven't saved a larger down payment, it makes me wonder if you know how to budget. No way I'd tap into retirement and wipe out my savings completely to buy a house.

Sounds like the tapping into retirement was just a bridge loan. But I don't know why they don't just roll the proceeds of their home over into the new house at settlement. The borrowing from retirement seems like an unnecessary step.

OP here, it is kinda like a bridge loan but if we make an offer, the closing date will be flexible for the sellers. If we can sell our home before the closing of this house that would be ideal but if not, the worst case scenario would be to tap into retirement and then pay back ASAP after we sell our home.

To answer other questions that I have missed, the credit card debts are already calculated into our monthly spending. We max out our TSP and plan to max out our TSP and will never stop that. DH is 35 and I am 33. Yes 2000 is our current fun money that DH and I get to do whatever we want with it, including saving it if we don't want to spend it. My mortgage is currently 2300 per month.

The responses that we are getting are really great. Definitely are keeping us grounded and we can continue to look back at this when we get the itch to move. Please keep posting!

[Anonymous]

I'll point out that new mortgage is $2,300 more than current, which is $300 more than "fun money." So if you move, you'd cut out all fun plus $300 a month. And depending on what your future plans are - you'd lock yourself into another 30 year mortgage, losing whatever years you've already paid into your current mortgage.

Since there doesn't seem to be too much prospect for income growth, it would be financially better to stay where you are, and save for a larger down payment. How much of a problem are the current schools - do you have to pay for private where you are? This may make the $million home seem more affordable if it gets you out of making private school tuition payments.

[Anonymous]

Anonymous wrote:

Anonymous wrote:We pay $4200 rent on a 180k salary. No daycare but two kids in Catholic school. Its been doable, but only because we are completely forgoing any other expense apart from food and contractually obligated bills. Only reason we're doing it is because it's an 18 month required rotation for my husband to get promoted and the company paid for moving expenses and deposit. If you have the down payment and moving expenses in hand I see no reason why you can't handle that payment on a larger salary.

A word of caution though. In the six months we've been here, the landlords have had to replace two major appliances, deal with tree roots in the plumbing, and remediate an infestation of carpenter ants. The house is only ten years old. The recommended savings rate for house maintenance is 1% of purchase price each year. Will you comfortably be able to save that on top of the sacrifices you will already be making?

Now this is crazy not only for the income and private school but renting at that amount.

Tell me about it. We had two day to find someone willing to rent to 4 kids, a dog, and a cat within an hour door to door commute. DH did a three hour round trip commute at one point in his career and swore he'd never do anything like it again.

It's a good thing we like camping holidays.

[Anonymous]

Please keep posting!

OK, a question for you. You and DH are 35 and 33 years old, respectively. You've told us you are both feds with HHI 300K. General Schedule pay is capped by law at about 150K. There are accepted service positions that pay much more, but generally those are for people with significant experience in big money industries, like Wall Street. Neither of you is old enough to justify pay at higher levels.

Would you explain how you got to the top of the federal pay scale at age 33? It takes years and years to climb to the top of the 15 grade and you can't possibly have the experience necessary to have negotiated a high step level at entry.

Just curious.

[Anonymous]

Anonymous wrote:

Please keep posting!

OK, a question for you. You and DH are 35 and 33 years old, respectively. You've told us you are both feds with HHI 300K. General Schedule pay is capped by law at about 150K. There are accepted service positions that pay much more, but generally those are for people with significant experience in big money industries, like Wall Street. Neither of you is old enough to justify pay at higher levels.

Would you explain how you got to the top of the federal pay scale at age 33? It takes years and years to climb to the top of the 15 grade and you can't possibly have the experience necessary to have negotiated a high step level at entry.

Just curious.

We are not on a general pay scale but a special pay scale. We are also not GS-15s we are GS-14s. There are GS-15s being paid equivalently. This is beside the point and I don't want to get off topic.

[Anonymous]

Anonymous wrote:I know a million sounds like a lot, but if OP is taking an 800K loan on a 300K salary, that's only 2.7 OP's annual income. Not a lot.

2.7 of gross is a lot.

[Anonymous]

We are not on a general pay scale but a special pay scale. We are also not GS-15s we are GS-14s. There are GS-15s being paid equivalently. This is beside the point and I don't want to get off topic.

You can't be on a "special pay scale" and be a GS-14 at the same time. You presented your circumstances and asked a question about what you could afford. Your circumstances are not off-topic. Two GS-14's in this area can make about 275K, maximum. Again, you are too young to be making that, barring serious abuse of the federal agency Buddy System. Is there additional income you haven't disclosed? Trust fund, or something else?

I'm curious, too.

[Anonymous]

There goes the thread.

[Anonymous]

Anonymous wrote:

Please keep posting!

OK, a question for you. You and DH are 35 and 33 years old, respectively. You've told us you are both feds with HHI 300K. General Schedule pay is capped by law at about 150K. There are accepted service positions that pay much more, but generally those are for people with significant experience in big money industries, like Wall Street. Neither of you is old enough to justify pay at higher levels.

Would you explain how you got to the top of the federal pay scale at age 33? It takes years and years to climb to the top of the 15 grade and you can't possibly have the experience necessary to have negotiated a high step level at entry.

Just curious.

Not OP, but DH is a 34-year-old GS15 who is maxed out at $155k.

[Anonymous]

Anonymous wrote:

We are not on a general pay scale but a special pay scale. We are also not GS-15s we are GS-14s. There are GS-15s being paid equivalently. This is beside the point and I don't want to get off topic.

You can't be on a "special pay scale" and be a GS-14 at the same time. You presented your circumstances and asked a question about what you could afford. Your circumstances are not off-topic. Two GS-14's in this area can make about 275K, maximum. Again, you are too young to be making that, barring serious abuse of the federal agency Buddy System. Is there additional income you haven't disclosed? Trust fund, or something else?

I'm curious, too.

Some agencies are paid based on a 50-hour work week and are paid accordingly.