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Old 01-16-2013, 11:56 PM
 
Location: Murrieta California
1,912 posts, read 1,357,817 times
Reputation: 1002
Quote:
Originally Posted by mysticaltyger View Post
$1,000,0000 mortgage with a $150K income. That is insanity Doing that basically makes you a high income slave. No thanks.
It is not insanity. It falls right in the average amount you could qualify for. However if that scares you so be it.
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Old 01-17-2013, 06:57 AM
 
10 posts, read 9,764 times
Reputation: 33
Why is the cost of living in the particular area so high, is there something I'm not seeing? seeing this makes me happy I own a home in NJ/NY but I really want to get out of here. I bought a beach house last year in Newport Beach for the family for the winter months and considering the area I got a pretty good deal on it. I was actually thinking of leaving NJ/NY and making a switch to the San Jose/surrounding areas and staying in California for good just because my job gives me the leverage of coming and going as I please but I guess I'll just stick to visiting. In another note, does anyone recommend any good lofts and or condos in the downtown area?

Last edited by Izucantc; 01-17-2013 at 07:10 AM..
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Old 01-17-2013, 08:01 AM
 
1,030 posts, read 1,537,990 times
Reputation: 759
Quote:
Originally Posted by JohnSoCal View Post
It is not insanity. It falls right in the average amount you could qualify for. However if that scares you so be it.
Maybe if you have a large down payment. If you're making $150k, that's $12.5k per month, before taxes. A mortgage of $1M would probably be around $6k per month. Perhaps $5k if you have a significant down payment or low interest rate. Your take home pay after taxes would only be around $8k/month. This doesn't even begin to factor property taxes, maintenance, insurance, savings for retirement, kids 529 plan, healthcare, transportation, utilities, food, clothing, etc. I just don't know how you would make it work without being EXTREMELY house poor.
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Old 01-17-2013, 09:43 AM
 
1,342 posts, read 914,441 times
Reputation: 1246
Quote:
Originally Posted by roadwarrior101 View Post
Maybe if you have a large down payment. If you're making $150k, that's $12.5k per month, before taxes. A mortgage of $1M would probably be around $6k per month. Perhaps $5k if you have a significant down payment or low interest rate. Your take home pay after taxes would only be around $8k/month. This doesn't even begin to factor property taxes, maintenance, insurance, savings for retirement, kids 529 plan, healthcare, transportation, utilities, food, clothing, etc. I just don't know how you would make it work without being EXTREMELY house poor.
Glad to know I'm not the only one seeing this thinking this isn't true. I tend to be on the conservative side but I think anything over $600k would be approaching unrealistic.
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Old 01-17-2013, 10:10 AM
 
1,030 posts, read 1,537,990 times
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Quote:
Originally Posted by flyingsaucermom View Post
Glad to know I'm not the only one seeing this thinking this isn't true. I tend to be on the conservative side but I think anything over $600k would be approaching unrealistic.
Then again, the lack of sound financial planning is why so many Americans defaulted on their mortgage during the crisis and why so few have enough saved for retirement or for their children's college education.
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Old 01-17-2013, 01:27 PM
 
Location: Murrieta California
1,912 posts, read 1,357,817 times
Reputation: 1002
Quote:
Originally Posted by roadwarrior101 View Post
Maybe if you have a large down payment. If you're making $150k, that's $12.5k per month, before taxes. A mortgage of $1M would probably be around $6k per month. Perhaps $5k if you have a significant down payment or low interest rate. Your take home pay after taxes would only be around $8k/month. This doesn't even begin to factor property taxes, maintenance, insurance, savings for retirement, kids 529 plan, healthcare, transportation, utilities, food, clothing, etc. I just don't know how you would make it work without being EXTREMELY house poor.
Your payment would be approximately $4,500 on a $1,000,000 loan at today's interest rates for a 30 year fixed. Your take home pay will be higher than $8k especially seeing as your mortgage interest is tax deductible.
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Old 01-17-2013, 01:30 PM
 
Location: Murrieta California
1,912 posts, read 1,357,817 times
Reputation: 1002
Quote:
Originally Posted by roadwarrior101 View Post
Then again, the lack of sound financial planning is why so many Americans defaulted on their mortgage during the crisis and why so few have enough saved for retirement or for their children's college education.
FYI, I am retired and my wife and I live very comfortably. I have never defaulted on any loan.
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Old 01-17-2013, 03:02 PM
 
1,030 posts, read 1,537,990 times
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Quote:
Originally Posted by JohnSoCal View Post
Your payment would be approximately $4,500 on a $1,000,000 loan at today's interest rates for a 30 year fixed. Your take home pay will be higher than $8k especially seeing as your mortgage interest is tax deductible.
And at 1.25% annual interest, your property tax would be $1000/month. You're going to be barely skating by, no matter how you want to dress it.
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Old 01-17-2013, 03:17 PM
 
189 posts, read 155,644 times
Reputation: 238
Quote:
Originally Posted by Izucantc View Post
Why is the cost of living in the particular area so high, is there something I'm not seeing? seeing this makes me happy I own a home in NJ/NY but I really want to get out of here. I bought a beach house last year in Newport Beach for the family for the winter months and considering the area I got a pretty good deal on it. I was actually thinking of leaving NJ/NY and making a switch to the San Jose/surrounding areas and staying in California for good just because my job gives me the leverage of coming and going as I please but I guess I'll just stick to visiting. In another note, does anyone recommend any good lofts and or condos in the downtown area?
Its all about the jobs...this is the home of Google, apple, facebook, venture capital firms, biotech etc. The same reason Goldman Sachs, Morgan Stanley, McKinsey, Bain etc. make NYC so expensive and federal government makes DC expensive.
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Old 01-17-2013, 05:46 PM
 
Location: Silicon Valley
2,507 posts, read 4,143,497 times
Reputation: 1437
Quote:
Originally Posted by JohnSoCal View Post
Your payment would be approximately $4,500 on a $1,000,000 loan at today's interest rates for a 30 year fixed. Your take home pay will be higher than $8k especially seeing as your mortgage interest is tax deductible.
Add $1000/month for property tax - and that's if you financed the entire cost of the house. If you put down 20% and still borrowed $1M, then the monthly property tax on your house is more like $1250.

I bought another house in San Jose last June, and Wells Fargo Mortgage told me I qualified for a home up to $2.2M. That's insane. That would be my price range if my income were double what it is.
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