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Old 06-05-2007, 02:59 PM
 
9,124 posts, read 36,282,016 times
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Quote:
Originally Posted by meameame12 View Post

my wife and i earn around the 250k range, combined, net...hard to estimate as it varies based on a variety of factors. WE CANT BUY. cause the debt / income ratio is killing us. we rent for 3k, but are stuck still. we need about 10k extra a month, more, and we will be in good shape then.
So, let me get this straight- you "net" $250k/year, which equates to over $20k/month, and you can't afford a $500k house because the "debt/income ratio is killing you"???? At today's interest rates, a $500k mortgage would run just over $3k/month. Add another $1k or so for taxes, and that's $4k/month, which is wll within lending guidelines for home debt/income ratios. If you're having a problem with meeting the "total debt/income ratio" of 36-38%, it sounds like you've got major issues outside of your housing costs, since you're spending something like $3-4k/month on revolving credit and/or car loans.

I'm not saying you need to buy a $500k house (in fact,I think one of your other posts was regarding trying to find a house for $300k), but I'm thinking you've got other things to fix before you worry about buying anything.......

Bob
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Old 06-05-2007, 03:20 PM
 
Location: NJ
12,283 posts, read 35,594,261 times
Reputation: 5331
Quote:
Originally Posted by BobKovacs View Post
So, let me get this straight- you "net" $250k/year, which equates to over $20k/month, and you can't afford a $500k house because the "debt/income ratio is killing you"???? At today's interest rates, a $500k mortgage would run just over $3k/month. Add another $1k or so for taxes, and that's $4k/month, which is wll within lending guidelines for home debt/income ratios. If you're having a problem with meeting the "total debt/income ratio" of 36-38%, it sounds like you've got major issues outside of your housing costs, since you're spending something like $3-4k/month on revolving credit and/or car loans.

I'm not saying you need to buy a $500k house (in fact,I think one of your other posts was regarding trying to find a house for $300k), but I'm thinking you've got other things to fix before you worry about buying anything.......

Bob
bingo. i'm not even sure how you get into the predicament this poster is with $20K a month flowing in. even if revolving credit/car loans are an issue, i can't imagine not being able to pay these off fairly quickly. maybe he/she has massive student loans, massive medical bills and/or is supporting family somewhere.

this isn't a housing cost or NJ issue.
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Old 06-09-2007, 01:02 AM
ehs
 
341 posts, read 2,292,083 times
Reputation: 128
Quote:
Originally Posted by BobKovacs View Post
So, let me get this straight- you "net" $250k/year, which equates to over $20k/month, and you can't afford a $500k house because the "debt/income ratio is killing you"???? At today's interest rates, a $500k mortgage would run just over $3k/month. Add another $1k or so for taxes, and that's $4k/month, which is wll within lending guidelines for home debt/income ratios. If you're having a problem with meeting the "total debt/income ratio" of 36-38%, it sounds like you've got major issues outside of your housing costs, since you're spending something like $3-4k/month on revolving credit and/or car loans.

I'm not saying you need to buy a $500k house (in fact,I think one of your other posts was regarding trying to find a house for $300k), but I'm thinking you've got other things to fix before you worry about buying anything.......

Bob
I know many Indian IT professionals making good money but can NOT afford to buy too big a house in Edison because they also invest some real estate back in India ...

This is similar situation to my colleageu at citibank who told me she has to sent big part of their family income to China their hometown to buy houses for their parents, bother, uncle ...etc.

Also, mortgage company think making $100 an hour is NOT $200,000 a year (even though you got 2,000 hours a year), they think your contract could be terminated any time.

When my brother-in-law bought their home, he was rejected by bank, and eventually he had to escalate all the way to EVP of Fidelity Investment Bank then to finally got his mortgage.

So, if you are FULL TIME employee, then that is different, using normal calculation. That's why lending is not as fair for many minorities in this country since they are more at "contracted jobs" or "hourly jobs" that could be unstable as far as mortgage and bank concern.
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