if I lose my job I am screwed at any mortgage price eventually. Of course you need 6-12 months in savings. Duh.

I'd much rather have a highly leveraged asset worth $1M appreciating than one worth $500K.

The poster who needs $25K TAKE HOME (after tax) to pay a $6K mtg is the dumbest person who posts here.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We have an HHI of $500k and when I read your post title, but stomach turned. That's a LOT of money. And the bank wants it every month. Our mortgage is $3500 per month and I think that's too much. I'd try for something that would be doable in case the higher earner lost their job.

That surprises me. With $300k take home, you couldn't swing $72k in piti? $6k a month so well within my comfort range at that income.

It's not we couldn't, it's that I don't want type of monthly obligation.

To each his own, but we pay more than you on less than half your income and I don't mind paying it at all, esp. as it's mostly principal.

What happens if the primary breadwinner loses their job? Can you still easily afford that $6K mortgage and not mind paying it at all?

That's the key - be leveraged but be able to delever. We borrow money at 2% because I can get 3,5% from my bank in Europe. It's a straight arbitrage. If one of us lost our job or the spread dropped I could very quickly unwind the thing. We borrowed $750k and parked it.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We have an HHI of $500k and when I read your post title, but stomach turned. That's a LOT of money. And the bank wants it every month. Our mortgage is $3500 per month and I think that's too much. I'd try for something that would be doable in case the higher earner lost their job.

That surprises me. With $300k take home, you couldn't swing $72k in piti? $6k a month so well within my comfort range at that income.

It's not we couldn't, it's that I don't want type of monthly obligation.

To each his own, but we pay more than you on less than half your income and I don't mind paying it at all, esp. as it's mostly principal.

What happens if the primary breadwinner loses their job? Can you still easily afford that $6K mortgage and not mind paying it at all?

I think that's ridiculous. For a 1.2 million dollar home, I would try to save more to bring down that payment. A lot of that is interest, and what if one of you loses your job. Can one person swing that mortgage???

Our determination of how much we would buy is what we can comfortably afford on one salary. This is why we bought a 600k house. And even with that, we put down well over 20% to bring down the mortgage payment. I would NEVER want to be house poor.

This is why people get starter homes...

Anonymous wrote:

Anonymous wrote:Not the pp but its certainly considered safe in many areas outside of DC and workable here if you're careful. Really if you're able to pay your mortgage, save for retirement and college, and have an emergency fund you're doing fine. The rest is gravy.

+1000
A lot of the posters here seem to be living in an alternate universe.

Well don't we live in the DC area? Why would it matter if 90k a year in Idaho is wealthy?

Anonymous wrote:Only if you have at least $25k/mo. in available income IMO.

Overleveraging can kill you, financially and leaves you no cushion at all if you hit a bump in the road.

... that is before taxes, etc., so you can pay them, put 20% away in IRA/retirement savings after you build up a 6 mo. (minimum) reserve of emergency cash, etc.

I hate debt, especially too much debt relative to income and with no assets to cushion you, you're taking a risk IMO.

Only if you have at least $25k/mo. in available income IMO.

Overleveraging can kill you, financially and leaves you no cushion at all if you hit a bump in the road.

We did this for a couple of years while we renovated our house. It was emphatically NOT FUN. Now we pay about $3500, which is still plenty. We paid the renovations off.

If you can pay 20% downpayment, AND pay all the bills on one income, go for it. Then save the second income. Buy the house you can afford. Don't understand trading up houses. We boughg a house we could afford and its paid off. I know lots of people who are upside down in their mortgage or lost their homes because they overextended themselves. Stop trying to showoff and do what's financially sound.

Anonymous wrote:Not the pp but its certainly considered safe in many areas outside of DC and workable here if you're careful. Really if you're able to pay your mortgage, save for retirement and college, and have an emergency fund you're doing fine. The rest is gravy.

+1000
A lot of the posters here seem to be living in an alternate universe.

Anonymous wrote:I really don't understand where everyone spends all their money. I'm the poster with the $6.5K mtg payment on a normal income and it is fine. I pay about $3K/month to principal, which is damn nice.

moving sucks. Your kids change schools and may lose friends. That is stressful. You lose neighbors that you might like. The costs of moving are huge. Realtor commissions, recordation and transfer taxes, capital gains, moving expenses, etc. Monsters.

Much depends on childcare. We spend $4,000 a month for 2 kids. Once that expense is gone it'll be like getting a $75,000 a year raise. Summer camps will eat away a bit at that but not that much.

Our take home is basically 12k,currently spent as Follows:

4k daycare
2k mortgage
1k food
1k electricity, cell phone, gas etc
$500 property tax
1k into savings
$500 car insurance, home insurance, life insurance

Take away the $4k for the daycare and we'd be sitting pretty.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I really don't understand where everyone spends all their money. I'm the poster with the $6.5K mtg payment on a normal income and it is fine. I pay about $3K/month to principal, which is damn nice.

I'm with you. We pay $7.3K a month in order to prepay the house before our kids go to college, and we are not at all considered rich by the DCUM's standards. And we have more than enough money left for everything else. I also don't understand what the high-income people are doing with their money. They are probably obsessed with saving $10-20M so their "rich" status can finally be approved by DCUM.

I love that you're "not rich by DCUM standards." Our household income after taxes is $5,200/month. WE aren't rich by DCUM standards by pretty well-off (90K salary, one SAHM parent). You have massively lost perspective if you can pay 7.3K/month and still have plenty of money leftover and you don't consider yourself rich (excuse me, rich by DCUM standards).

OP, I would have to take home 20K/month to be comfortable with a 6K/month mortgage. It's just risky business to spend more than 30% of your take-home on a mortgage. Our take home is $5,200/month and our mortgage is $1,350. It allows us to save a bit for retirement, a bit for college, take one decent vacation a year, give a bit to charity, pay our utilities, keep a 10K emergency fund (replenishing after emergency car and home repairs) and cover food and entertainment.

I don't think 90k single income is really considered well off or safe even by non DCUM standards.

Maybe no well off but definitely safe.

Anonymous wrote:

Anonymous wrote:I really don't understand where everyone spends all their money. I'm the poster with the $6.5K mtg payment on a normal income and it is fine. I pay about $3K/month to principal, which is damn nice.

I'm with you. We pay $7.3K a month in order to prepay the house before our kids go to college, and we are not at all considered rich by the DCUM's standards. And we have more than enough money left for everything else. I also don't understand what the high-income people are doing with their money. They are probably obsessed with saving $10-20M so their "rich" status can finally be approved by DCUM.

Are you socking away money into your retirement account and have 6 to 8 mo. in emergency savings, college savings? What is considered HHI? More than $100K? Didn't they say medium income around this area is like $150K or something? Well I guess we could be considered above median at about $250K.

Our mortgage is $1850, and that includes tax and insurance. Actual mortgage is about $1200. We put a HUGE down payment on the house. But it also costs $ to maintain the house, especially in the harsher climates. Don't forget upkeep in the yards as well. Utilities here can be upwards of $400/mo especially in the winter and summer. Gas is damn expensive, and so is food. Childcare, too, if you use one. Summer camps...oh my, with 2 kids, I can easily spend upwards of $2K. After school activities, pool membership, etc... It all seems to add up.

What do we do with our money? We save the max in our retirement so we are not a burden on our kids or society and having to choose between food and Rx when we are old. We have 6 to 8 mo. in emergency savings. Have you not heard about how so many people that got sick ended up losing their homes because of our ridiculous medical costs? With the rest, we enjoy our lives, but not with material things. I do not care about having a "rich" status. No, we don't have $10-20mil. I wish. I still drive a 10+yr old car. Prob. will buy new one in next year but it will be under $30K. We are not materialistic. I still buy clothes from Target, Kohls, etc.. We like to go on nice vacations with our kids at least once a year. Our families are on 2 different continents, so it gets expensive to travel.

We are very comfortable because we don't try to keep up with the Jones' and don't have to worry too much about losing the home if someone gets sick. What do you all do with your $ for the HHI, but under $200K?

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I really don't understand where everyone spends all their money. I'm the poster with the $6.5K mtg payment on a normal income and it is fine. I pay about $3K/month to principal, which is damn nice.

I'm with you. We pay $7.3K a month in order to prepay the house before our kids go to college, and we are not at all considered rich by the DCUM's standards. And we have more than enough money left for everything else. I also don't understand what the high-income people are doing with their money. They are probably obsessed with saving $10-20M so their "rich" status can finally be approved by DCUM.

I love that you're "not rich by DCUM standards." Our household income after taxes is $5,200/month. WE aren't rich by DCUM standards by pretty well-off (90K salary, one SAHM parent). You have massively lost perspective if you can pay 7.3K/month and still have plenty of money leftover and you don't consider yourself rich (excuse me, rich by DCUM standards).

OP, I would have to take home 20K/month to be comfortable with a 6K/month mortgage. It's just risky business to spend more than 30% of your take-home on a mortgage. Our take home is $5,200/month and our mortgage is $1,350. It allows us to save a bit for retirement, a bit for college, take one decent vacation a year, give a bit to charity, pay our utilities, keep a 10K emergency fund (replenishing after emergency car and home repairs) and cover food and entertainment.

I don't think 90k single income is really considered well off or safe even by non DCUM standards.

Talk about lost perspective.

Anonymous wrote:

look, the more you make the less relevant those percentages are. so you think you need $14K TAKE HOME that is not for housing? what in the hell would you need to do with that $14K a month? makes no sense.

Agreed. The percentages only work at lower income levels. We're at a higher income level, but our other expenses aren't at the same proportion. It's not like our grocery costs go from $1k to $3k just because we're at a higher HHI, meaning we need to set aside a lot more for groceries.