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Wife makes about $40K a year and I make around $32K. With about $800 monthly total of debt.
The median housing market is around $250K in our area.
Absent substantial down payment money you'll probably need to move.
Quote:
Do you think $220K would be...
A first pass "ROT" hurdle and nothing more.
You need to drill down into your personal finances and plan a holistic budget.
In addition to the mandated and unavoidable (Income taxes, SS/FICA, etc) are deducted from your gross
how much are you willing to set as a save/invest (& debt service) commitment ... and really stick to it?
When you can get down to this level of NET INCOME then you can start to budget the (rent or buy) monthlies.
How many WEEKLY shares of that net income are you willing to spend on the MONTHLY housing costs*?
(*Housing costs are more than just the mortgage: PITI, HOA, CONDO, Utlitities, Upkeep,
plus any help you'll hire and any other costs you're obliged to pay in order to live there.)
Well, you've been on threads talking about your wife not working, changing jobs, getting 2nd jobs, and cashing out 401k. Does this seem like the time to buy a house?
Hi looking to hopefully purchase a house next year. The median housing market is around $250K in our area.
Wife makes about $40K a year and I make around $32K. With about $800 monthly total of debt.
Do you think $220K would be our max budget or should we go a little bit less?
Plan to utilize FHA and DAP.
My income at the time was about 40K more than your combined income and I cringed at spending 200K (although our RE taxes are through the roof here and yours may not be). The general rule is 2.5 x income (which would put you at 180) and 28% of income to PITI, not to mention DTI. I don't want to dissuade you from living your life but I would hate to see you fail.
Well, 70k is about 50k net, or 4200/month. Less 800/mo debt service leaves you 3400/month. The rule of thumb is 1/3 of your income for PITI, or something like 1100/month. That sounds like a 130,000 mortgage or so to me.
So, how much do you have saved up for a down payment?
Location: Stuck on the East Coast, hoping to head West
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Live like you already own it. In other words if your rent is currently $1000 and a mortgage is $1500, subtract 1500 a month from your budget. Put it in another account or something and pretend it's gone. Include higher utilities (assuming you move to bigger place) and then subtract another $415/month for maintenance (took 250000 x 2% and divided by 12).
OP - you'd get better answers by sitting down with a lender. They can take a look at all your numbers, and tell you what amount you prequalify for and how much of a monthly payment that comes with. You'll need their help because with almost no downpayment, you will be paying PMI. Then like bande1102 suggested, start living like you have that mortgage payment now.
Being familiar with your other threads, my suggestion is that you first pay down your CC debt without cashing out your retirement account nor taking a lower paying job to do so. Which will likely take more than a year. Have the patience and determination to get your finances in good order before buying a home.
Hi looking to hopefully purchase a house next year. The median housing market is around $250K in our area.
Wife makes about $40K a year and I make around $32K. With about $800 monthly total of debt.
Do you think $220K would be our max budget or should we go a little bit less?
Plan to utilize FHA and DAP.
You need to get prequalified. If you are going FHA, I am assuming a low down payment; then you will also be paying a portion of taxes and insurance into escrow, along with mortgage insurance. IMO, this is way over your budget without knowing more.
Get a USDA, 0% down. It doesn't mean you'll be out in BFE. I got a USDA mortgage on a property 10 minutes from I-85. Buy cheap, save more than you'll EVER think you'll need, because one day, you'll need it.
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