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I am new to this site so I apologize if I'm not submitting this question in the proper fashion. I am on the fence about a new home and really just need to hear some vetted responses if possible. If I have a combined household income of 70k/yr, with only a car loan of 13k @$225/mo would a 210k home be doable? Estimated down payment would be 8%. I have crunched the numbers and the mortgage payment (including taxes, insurance and HOA fees) would be $400/mo more than our current mortgage. We are also planning to rent/sell our current property (condo). Credit score is 790. No bankruptcy, foreclosures or outstanding debts, we have stable employment.
If you are planning to lease out the condo, great idea to make sure you can cover about 6 months' mortgage payments on the condo in savings held back separately just for the condo. Just having that reserved amount will keep you from making silly landlord mistakes by accepting marginal tenants during vacancies or doing half-baked repairs.
Otherwise, if you are fine with the increased $400/mo, I don't think the price of the new house is bad.
What sort of savings do you have? What's the state of your bank account at the end of the month? If you're eating ramen noodles then, or if you have no savings, I wouldn't do it.
It may or may not be doable depending on your lifestyle. If you like to go out to eat, go clubbing, travel a lot, then a lower debt to income would be in order. If you are like to stay home a lot, then it is more doable.
Thank you for the replies! We do stay in a lot and use an app called YNAB (you need a budget) to maintain a steady track of expenses. I did put in the post that it included insurance JKgourmet, so...you're guessing wrong. If I took the "3.5 rule" it would be right at $245k however I feel like that is too much to take on. Current savings is roughly $10k and 401k at $35k (not that I would ever want to cash it in) we're about 40 years away from retirement. Our condo is also worth $15k more than what we paid for it, so it makes the rent or sell question that much more difficult. This is also a new home so it will take about 8 months to build, which gives us a decent bit of time to stack some savings as just in case money.
Ok, I gotcha. Thank you for clarifying. I appreciate all of the help. I wasn't aware of the MIP, so just to be clear if I put down less than 20% on the loan I will be required to purchase mortgage insurance?
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