(Closed) Would we pass for a new home?

posted 6 years ago in Home
Post # 3
3968 posts
Honey bee
  • Wedding: September 2014

@lioness_89:  oh my god, that looks like a mansion. 130k!?!??! Oh, god, let’s move to Texas…. You can’t buy a condo for that. AHHHHHH I know nothing about mortgages or buying a home, but man oh man, just had to say WOW!

Post # 4
383 posts
Helper bee
  • Wedding: September 2013

I think on average your mortgage should be around 2.5 to 3 times your annual salary, so around 90k.  He also might have problems because this is a new job and he hasn’t been there very long, lenders usually want you to be at the same job or same industry for 2 years.  

I also just wanted to comment that I’m from south Texas too, I’m from Brownsville but live in Arizona now. 

Post # 5
1360 posts
Bumble bee

My Fiance makes around 30k a year, and we believe he needs to stay around the 90k mark for a home (like PP said, 3x the annual salary). But where we live in Alabama, you can get a nice home for around 80k if you know where to look.

I wouldn’t go too much over 100k though, because you don’t want to be stressed out over trying to pay the mortgage each month. I know my parents had a mortgage for 115k and their monthly payment was around 1300 (basically one of your FI’s paychecks.)

Post # 6
18641 posts
Honey Beekeeper
  • Wedding: June 2009

Do you have any money for a downpayment?  Unless you are in a rural development area or you go for the FHA first time buyers program, it’s pretty hard to get a loan without some cash in.  Even with a FHA loan, you need 3.5% down.

Your debt payments should be about 35% of your take home pay.

Don’t forget to budget in insurance, utilities, cable/internet, and other home expenses.

Post # 7
14568 posts
Honey Beekeeper
  • Wedding: June 2011

A 150k mortage at 4% right now is under $750 a month.  With an income of 2.5k/month minus taxes of 25% (?) leaves you about 1875… so you’d have over 1k to put into retirement/save/bill…what not.  I think it’s tight, but I also think a bank would approve you.  I think they (at least they used to) normally approve a mortgage to income gross ratio of about 33%.  If the 30k/year of his salary is just temporary and you will be working soon too, I’d totally go for it and just live with a tighter budget for a bit.

PS.  I’m totally jealous that house is 150k… that’s easily 400k+ in MA.

Post # 8
13073 posts
Honey Beekeeper
  • Wedding: November 1999

Depending on the type of mortgage you get (Conventional, FHA, or VA), there are limits for how much of your money can be tied up in recurring monthly debts.  These percentages equate to between 40 and 45% of your PRE-TAX monthly take home pay.  Debts include car payments, student loans, cell phone bills, utilities, insurances, and any other service you get a bill for. 

30k / 12 months breaks down to 2,500 pretax each month.  40% of that is $1,000 – meaning, to get approved for a conforming loan, you can have $1,000 in recurring monthly debt, including your mortgage.

Your best bet is going to talk to a mortgage lender or broker with your specific numbers (assets, debts, liabilities, financial outlook, etc) to find out approximately how much you’ll be approved for. 

Keep in mind, any salary he has must be documented, and bonuses and things will not count towards your monthly income because they can’t be counted on for recurring income.  So, while it’s awesome that he might get an extra 2.5k a month with those 16 hours, it won’t matter when calculating a mortgage until he’s had that income steadiy. 

Post # 10
6215 posts
Bee Keeper
  • Wedding: August 2013 - The Liberty House

Don’t forget property taxes too!

Post # 11
3296 posts
Sugar bee
  • Wedding: August 2013 - An amazing non-profit retreat

gahhhh a house like that here would be $350 K! Our one bedroom with loft duplex was $199! Need to move to the states…

Post # 12
3296 posts
Sugar bee
  • Wedding: August 2013 - An amazing non-profit retreat

gahhhh a house like that here would be $350 K! Our one bedroom with loft duplex was $199! Need to move to the states…

Post # 13
7311 posts
Busy Beekeeper
  • Wedding: October 2011 - Bed & Breakfast

Remember, just because you “could” get approved for a loan, particularly one that represents such a significant amount of your monthly income, that does not mean that you “should” do it, or that it is the financially responsible choice. If you do FHA, your downpayment on a $150k loan would be $5250, plus $5k for closing costs, plus $3k for basic appliances because new homes don’t come with refridgerators/washers/dryers, plus $500ish for window coverings (also not included in new construction, could be more if you want better than Target quality), plus having a 6 month emergency fund (your monthly bills/food/gas budget x 6 months, so probably about $10-12k total). That is about $29,000 that you should have in the bank before you start looking at houses.

Since you don’t have anything saved yet, I think it may take you a while. That’s okay! It’s much better to save aggressively for a few years and make sure that you are really financially ready than it is to rush into a purchase that you can barely afford and have no financial safety net to fall back on. Home ownership is expensive, so make sure you are prepared.

Post # 15
13096 posts
Honey Beekeeper
  • Wedding: July 2010

@lovekiss:  and @lioness_89:  Other silly little things you don’t think about or realize with new build homes … we had to spend $500 at Lowes the weekend we moved in because our new build didn’t have things like toilet paper holders and towel rods and shower curtain rods in the bathrooms.

Post # 16
1543 posts
Bumble bee
  • Wedding: June 2013

My Fiance makes around 42k and he qualified for our home on his own… also 130k. And he has a pretty big car payment. We ended up doing it in both our names anyway so i don’t know if final loan paperwork would have been an issue.

Do you have any income to qualify? WE actually got a USDA loan so we got 100% financing and a very low PMI. Our 130k house is costing us 816 per month and thats including Homeowners insurance and property tax.  (our 1 bedroom appt was like 750 and our rent was expected to increase!) Getting into our home was  the best decision we ever made!

If you can do it financially then i say go for it! But i will say that my sis lives in texas (near Dallas/Fort Worth) and her property taxes are outrageous so remember to consider that in what you can afford.

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