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I'm looking at a 2 bedroom in the $2700-$2800 range. Would this be acceptable on a $100,000 salary before taxes? It's a bit short of the 40x rule (which would be about $112,000) Can they let this slide?
without knowing overall debt and lifestyle no can answere that but you, maybe car payments and credit cards eat 1/2 that .... banks have been going to overall debt cant be more than 35-40% pretax income when you buy but key word is overall debt and pretax means something sometimes when you buy not when you rent. although you dont really get a write off that comes off your income when you buy because your actually spending an additional 3 bucks in interest and taxes to get back 1 buck (sometimes) , the fact is all that extra dough may bring a portion back unlike rent
and the reason i say sometimes when you buy is because with more and more of us getting hit with the amt tax when you buy and have those deductions they can sometimes trigger the amt tax putting you on just a flat rate and no writeoffs, also whether you buy or not everyone gets the standard deduction anyway so all calculations start at the standard deduction point and you may find your 20,000 in deductions is closer to 5,000 in reality
Last edited by mathjak107; 12-19-2008 at 04:03 AM..
I'm looking at a 2 bedroom in the $2700-$2800 range. Would this be acceptable on a $100,000 salary before taxes? It's a bit short of the 40x rule (which would be about $112,000) Can they let this slide?
Sometimes landlords in the outer boroughs ignore the 40 x rule and look at income, employment, credit history. You can get something in those parameters in an outer borough.
It's a rule-of-thumb, not a law. It depends upon what you negotiate with the landlord. With the current state of the market, they may be more willing to negotiate.
You probably could but why would you want to? Cut your housing costs significantly and you will be able to enjoy all that NYC has to offer. Or you can pay ALOT for housing, and leave little left over to actually have fun. Choice is yours.
You probably could but why would you want to? Cut your housing costs significantly and you will be able to enjoy all that NYC has to offer. Or you can pay ALOT for housing, and leave little left over to actually have fun. Choice is yours.
I was thinking the same thing SobroGuy. That seems like a ridiculous amount of rent to pay on a 100K salary. I'd find something a lot cheaper and have fun imagining what I'd do with the extra (I was thinking a trip around the world).
Its all fun and games in the beginning as its easy to cut expenses elsewhere to affored the apartment. later on when the apartment owns you its most ungood as everything becomes a trade off you want to do
I agree that the OP can cut his/her housing costs significantly by living in an outer borough, e.g., and having money left over for savings, retirement, fun, etc. However since he/she was asking if they can work around the 40 x rule of thumb, I assume that they didn't need info on budgeting. The budgeting advice is great and I hope the OP appreciates that - but yes, they can work around the 40 x rule in a variety of ways previously specified.
one of the reasons i never wanted to live in those city apartments is the cost would keep us from doing all the other things we like to do and buy....
not worth it to us and we already own them, we would have to pay our partners market rent though even though it would be 75% of it since 1/4 is ours
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