am i insane for considering this? 820k mortgage on a 240k income
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Anonymous
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240k HHI, very stable jobs but limited upside aside from reg step increases
NO DEBT aside from a 500 dollar car payment one child in elementary with no plans for more 980k house minus 160k downpayment (820k mortgage) I think its reasonable, but others have implied that it is a HUGE reach.. what do you guys think? For those that think its reasonable, do you think theres room to stretch more? |
Anonymous
| My HHI is more and I think it's too much. |
Anonymous
| yes, that is insane. |
Anonymous
| How secure are your jobs? How's your savings? Are you planning to stay in this home a long time? What's your monthly payment with that mortgage and how does it fit in with your budget? How's your kid's college savings? How's your budget for fixing things like the roof or whatever? |
Anonymous
| I think it's at the far end of achievable, but wouldn't characterize it as reasonable. |
Anonymous
| This is a joke post, right? |
Anonymous
| Too much of a reach. |
Anonymous
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That mortgage is 3.4x your annual income.
I think it's totally fine. It's actually a lot lower than some areas of the country where people typically buy 5x their income (SF, LA, San Diego, Seattle). We did an 815K mortgage on $260K when we bought our house in 2017. Our HHI is now near $400K and will eventually top out at $500K. Very stable jobs. |
Anonymous
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That would scare me, even with very secure jobs (which I'm guess you are both in government, so probably they are).
So you feel in love with a 980k house and you're trying to make it work. I get it, this market is painful and I understand that what I'm about to say will sound impossible. You need to find a cheaper house and put down the same down payment. In fact, if I were you I'd wait a year, save aggressively, and try to put down a down payment of 200k+ on a house that was under 850k. I think in the long run this would be much more manageable. Take your efforts to stretch your budget and apply them to getting a 15 year mortgage instead, so you can pay it down faster. You only have one child! You can find something in this range in a decent neighborhood, I promise. You will have to make some compromises, but trying to do what you are proposing will mean having to make compromises literally every day because you will be so pinched for cash. |
Anonymous
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Not insane, but I think people really underestimate how much easier life is when you're not thinking about money all the time.
You can technically afford this house on the numbers, but you will be on a budget, all the time. And depending on what your kid's college savings look like now, it might be a tight budget. And you will not be sure if you can afford travel sports, or certain vacations, or one parent stepping back when you would benefit from it for various family/health reasons. And you will be one of the people on this board making a very solid income but feeling like you don't know where it all goes. |
Anonymous
I will add that our house has a basement income unit and we were pulling in $25K/year for the first three years of our mortgage. It helped us immensely. Our net housing outlay each month was $2400 once we factored in the rental income. If this house has a rentable unit, you are absolutely fine to pay this much. |
Anonymous
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All the questions about how stable are your jobs, how long will you be there, whether or not this is "scary" are missing the point.
You will never build financial independence in this scenario. It's too much of your income going to a mortgage that should be going into investments. It will keep you a slave to your jobs and your house. |
Anonymous
No wonder you think it's fine. Our HHI did something similar after buying, but OP is apparently dual-fed. If history is any indication, they're looking at a couple of step increases to top out around $300k, and then their very stable jobs will start to lose ground to inflation. |
Anonymous
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That's fine. Do you have college saved up and retirement?
We bought 1.2 with 20٪down on 250 HHI, kids college and retirement banked, little debt |
Anonymous
| Yes too much. Mostly because your down payment is too low. We have similar stats and do have a million dollar home but we put down 350k |