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Old 08-29-2011, 10:39 AM
 
1,191 posts, read 1,821,727 times
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Quote:
Originally Posted by stp_fan View Post
If you lost your job tomorrow, how long could you continue to pay your mortgage and when would it start effecting your kid's lives.....

just rent a townhouse until you save more money up...
Losing your job while renting isn't much better. At least with a home you can live there for at least a year before you get foreclosed. Stop paying your rent and see how long you last
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Old 08-30-2011, 07:44 AM
 
Location: Northern Virginia
169 posts, read 301,609 times
Reputation: 156
Quote:
Originally Posted by boyd888 View Post
Losing your job while renting isn't much better. At least with a home you can live there for at least a year before you get foreclosed. Stop paying your rent and see how long you last
I'd much rather deal with a landlord to whom I owe $5K-$10K for the remainder of a year lease than a large bank to whom I owe $100K-$200K for a 30 year mortgage. And as far as damage to your credit record, I would guess that an eviction is easier to recover from than a foreclosure.
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Old 08-30-2011, 09:51 PM
 
504 posts, read 651,588 times
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Quote:
Originally Posted by vauser View Post
Very helpful responses (as always!) in this forum. Thanks much. Some more details, if it helps:

* Combined family income: $150K+.
* Mid 30s.
* No debts other than the mortgage on the home.
* Family of 3.
28% of 150K works out to $3500/mo. Making some assumptions about property tax and insurance, and given current low interest rates that would translate to about a $600k mortgage. Potentially you could go higher, but you increase the risk of being "house poor". Obviously you'll also need to bring cash for a down payment and closing costs.

If $3500/mo is more than you are comfortable with, then you can dial it back to an amount that works better for you.

A better approach might be figuring out what monthly payment you are comfortable with and how much cash you are willing to spend for a down payment and closing costs. From there it is pretty straightforward math to calculate how what home price you can afford.
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Old 08-31-2011, 05:28 AM
 
268 posts, read 341,019 times
Reputation: 205
Quote:
Originally Posted by shamrock847 View Post
28% of 150K works out to $3500/mo. Making some assumptions about property tax and insurance, and given current low interest rates that would translate to about a $600k mortgage. Potentially you could go higher, but you increase the risk of being "house poor". Obviously you'll also need to bring cash for a down payment and closing costs.

If $3500/mo is more than you are comfortable with, then you can dial it back to an amount that works better for you.

A better approach might be figuring out what monthly payment you are comfortable with and how much cash you are willing to spend for a down payment and closing costs. From there it is pretty straightforward math to calculate how what home price you can afford.

FWIW,
The above metrics fit our scenario almost exactly, we closed on our house Late June. We went over the numbers again and again, being the cheapskate that I am I was very aprehensive with a mortage of $3k+ (including taxes,insurance,HOA). However we are aproaching September and we have no regrets with our purchase, and we feel like we have more then enough to not feel house poor. Even with all the purchases you make when you move into a home (new furniture, yard tools, replacement of anything builder grade).

sale price 520K
Rate 4.5% 30yr
combined income is just under 150K.
Oh P.S. Wife and I are under 28 years of age.
Hope that helps.
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Old 08-31-2011, 07:23 AM
 
Location: Fairfax, VA
1,449 posts, read 2,803,107 times
Reputation: 471
Quote:
Originally Posted by Jon_In_NOVA View Post
FWIW,
The above metrics fit our scenario almost exactly, we closed on our house Late June. We went over the numbers again and again, being the cheapskate that I am I was very aprehensive with a mortage of $3k+ (including taxes,insurance,HOA). However we are aproaching September and we have no regrets with our purchase, and we feel like we have more then enough to not feel house poor. Even with all the purchases you make when you move into a home (new furniture, yard tools, replacement of anything builder grade).

sale price 520K
Rate 4.5% 30yr
combined income is just under 150K.
Oh P.S. Wife and I are under 28 years of age.
Hope that helps.
Do you have kids yet? Just curious. That is a BIG line item that can affect how comfortable a mortgage in that range is. The mortgage we are about to take on today basically is our current mortgage+the cost of our daughter's monthly daycare which is going away because she is entering K. If we have another, we will probably have to cut back on savings since daycare is NOT cheap.
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