Doubts of a future Houston resident (Sugar Land, Katy: rent, insurance, mortgage)

[Affilho]

First of all sorry if I make any grammar mistake, but I'm from Brazil and English is not my first language . This forum is wondeful, and I hope someone can help me with a doubt.

I'll be moving to Houston from Sao Paulo - Brazil with my wife and my 6 years old daughter next year. My company is sponsorship my move.

I'll work at the Galleria area and we are thinking in buying a house in Katy. I know the comute time can be bad, but I'm used to heavy traffic around here and we believe the schools, house prices and the place itself is worth the time I'll spend in the car.

My main doubt is about how much of my year income I can compromise with the mortgage + taxes. I've used a lot of mortgage calculators and 'cost of life' sites information, but I could not get to a conclusive answer... I'll be making around 130K/year. Can I afford a house in the 350-400K range?

Some additional information that may help. My daughter is going to public school. We'll buy 2 modest cars. If needed, I can make a down payment of 20% for the house.

Thanks!

[huma281]

I think the bigger issue is if a bank will loan you $400k on $130k income if you don't have credit established. After income taxes, you'll probably make around $95k.

$95k/12 = $7,900 month.

$400k loan @ 30 years = $1,910 before property taxes and insurance.

Property taxes and insurance is probably $14k a year.

You're looking at round $3,000 a month for mortgage, property taxes and insurance.

[ptt]

Of course, you can afford 350-400k but if I were you I wouldnt go beyond 350k. You could still find a smaller home 2500 ish sq.f. for 300-350k in katy or greentrails area. Keep your mortgage payment low so, you could save for your future and your daughter college fund and fun things in life.

[Affilho]

Thanks huma281 and ptt!

[Htown2013]

With 20% down, yes, you can afford it, but it depends on a number of factors. How long are you planning to be in Houston? If this is a long term relocation, then get something you'll see yourself in long term. If this is just for a few years, save your money, and get something that meets your needs for the time being.

You'll be working in the Galleria and want to live in Katy? Have you considered Sugar Land? That's a much better commute to the Galleria.

[texas7]

Guess it really depends on your take home pay and not the gross. Some people have a lot of deductions from their pay for things other than taxes such as 401k, company services they are allowed to deduct from payroll, 401k loans, etc.

[shanv3]

Credit history is an important factor. Even if your company helps you initially with some loan for down payment etc, having a better credit score will get you better rates.You can probably rent something for initial months and establish a credit history. credit unions give you credit cards . I could get a score of 780 within a year which is above good and below excellent. (now its 620 and I am having to pay extra in almost everything - renting, car loan etc)

[Affilho]

Thanks for all the replies.

I'll take a look at sugar land and also read about how to build the credit score.

[Affilho]

Thanks for all the replies.

I'll take a look at sugar land and also read about how to build the credit score.