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Old 08-28-2018, 06:33 PM
 
Location: Rutherfordton,NC
12,131 posts, read 8,106,619 times
Reputation: 8609

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This might be in the wrong place but, why come tax season and when were buying a car, renting a apt/house.
Why do these people look at our gross income and not what we bring home?

Ive never understood this.
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Old 08-28-2018, 07:05 PM
 
Location: East of Seattle since 1992, originally from SF Bay Area
28,400 posts, read 50,602,810 times
Reputation: 28637
When determining credit worthiness, they use software that plugs in all of the usual averages for tax bite and other expenses. Actually, a person could make $200,000 and spend $300/day in cash purchases ($109,500/year) and not have enough for the car payment, but the risk of that is low, and if they have a good credit score they will get the car or rental home.
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Old 08-28-2018, 07:20 PM
 
3,748 posts, read 7,216,574 times
Reputation: 4825
Quote:
Originally Posted by reed067 View Post
This might be in the wrong place but, why come tax season and when were buying a car, renting a apt/house.
Why do these people look at our gross income and not what we bring home?

Ive never understood this.
Me neither. What you take home after taxes is what you have to live on and that is what everything should be based on.
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Old 08-29-2018, 12:02 AM
 
5,479 posts, read 8,165,528 times
Reputation: 7302
Quote:
Originally Posted by davidt1 View Post
Me neither. What you take home after taxes is what you have to live on and that is what everything should be based on.
If you make $50k and stick $15k into your retirement funds does that mean your doing the same job as a $35k breadwinner?
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Old 08-29-2018, 04:20 AM
 
Location: The Triad (NC)
26,855 posts, read 57,874,473 times
Reputation: 29278
Quote:
Originally Posted by reed067 View Post
Why do these people look at our gross income and not what we bring home?
It doesn't matter what number THEY use or why.
What matters is that WE use the net number.
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Old 08-29-2018, 05:02 AM
 
29 posts, read 7,513 times
Reputation: 33
I think net is best and the final when compared to gross
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Old 08-29-2018, 08:33 AM
 
17,626 posts, read 12,211,350 times
Reputation: 12864
Quote:
Originally Posted by Themanwithnoname View Post
If you make $50k and stick $15k into your retirement funds does that mean your doing the same job as a $35k breadwinner?
This is part of it. I can turn off 401k contributions 2x and that would be 37k extra coming in
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Old 08-29-2018, 09:03 AM
 
17,749 posts, read 15,031,977 times
Reputation: 6377
Quote:
Originally Posted by MrRational View Post
It doesn't matter what number THEY use or why.
What matters is that WE use the net number.

if da guberment bails out creditors it does not matter what number they use. If da gubermnet decides not to bail the creditors out, then being the ones loaning the money ,its the number they want to use.
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Old 08-29-2018, 09:08 AM
 
4,847 posts, read 2,149,409 times
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As someone who has been the poorest of poor and even had a decade of living a high income life...I can tell you that NET Matters!
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Old 08-29-2018, 09:11 AM
 
1,255 posts, read 809,464 times
Reputation: 2247
Quote:
Originally Posted by MrRational View Post
It doesn't matter what number THEY use or why.
What matters is that WE use the net number.
Thread winner.

The reason THEY do it is because the want US to think WE can afford a bigger loan than WE really can. Same reason most car dealers talk in terms of "monthly payment" instead of total cost of a car.

THEY do this because their job is to get US to give them as much of OUR money as possible. THEY don't care if WE can afford it or if it means OUR retirement savings goes unfunded or even if OUR children have shoes.
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