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How do you sleep at night? Knowing someone is that close to not being able to pay a payment and could lose their house. Nice.
Again, you know virtually nothing of the total financial picture of this borrower. I know the guy, his whole family tree and his whole financial picture. He has very minimal probability of default, but just knowing a couple of numbers you make many assumptions. Just like with the OP.
Frugal living would mean getting a home within your means.
I understand the desire for a big beautiful home. But you did say that you are patient. Perhaps get something that is within a comfortable budget so that you have a much more manageable mortgage payment.
Since you plan to be frugal, continue to be frugal. Save the difference. Eventually you'll have enough savings to be in a position to sell your modest home and then add in your savings to put a large down on the home of your dreams.
You dont want to put yourself in the position where your dream becomes your nightmare.
We're talking about a best case scenario longest term loan with good interest rates his total home cost being 75% of gross pay on one of his low salary months. If he has even a low car payment, basic gas and insurance cost, health insurance cost , etc, he will be in the red that month.
This is not manageable no matter who you are without additional income or assets you're willing to lose. The original numbers didn't account for PMI, insurance, etc. Once you fold in utilities and basic cost of maintenance his house could exceed 100% of his pay after taxes.
We're talking about a best case scenario longest term loan with good interest rates his total home cost being 75% of gross pay on one of his low salary months. If he has even a low car payment, basic gas and insurance cost, health insurance cost , etc, he will be in the red that month.
This is not manageable no matter who you are without additional income or assets you're willing to lose. The original numbers didn't account for PMI, insurance, etc. Once you fold in utilities and basic cost of maintenance his house could exceed 100% of his pay after taxes.
12 months from now: "I am 5 months behind on my house payment. Why do banks have to refuse to give me a year or two to catch up on my mortgage before foreclosing"? -OP
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