it was DIY except for the plumbing and the tile. Paid a plumber friend of mine 20 an hour off the books to take care of that part, and $400 to the tile guy. Of course, his discount saved me $300 on the tile itself so that was worth it.
I went to the bank and was pre-approved for way too much, then worked out what I could afford w/o any income from the soon to be wife (at the time).
Found a house and tried to lowball the seller with an “as is” condition.
Lucky for me wifie lost her job and has been a stay at home mom for over 5 years now.
I checked all the NYSpeed posts to see what others payed for houses and the good responses people gave, and then went $10,000 higher.
I was pre-approved for 220 from work and I took 72 :lol:
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You’ve got to decide what kind of debt structure you’re cool with. 30 year mortgage? 30 year, but pay extra to pay it off in 20? 15 year? Finance 100%? Put 20% down? There are pros and cons to everything. The interest rate you qualify for should influence this, as well as personal preference. Do you want a nicer house now but pay a premium in the long run? Buckle down for 15 years and be way farther ahead at that point? Somewhere in between?
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Then look at all of your expenses, be honest with yourself. Don’t forget a decent contingency, 401k, savings, etc. This will tell you what kind of monthly payment you can make.
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Use number 2 as a constraint on number 1. You now know how big of a mortgage you’re looking at.
Like Joe said as a rule of thumb, twice your annual income will put you in the right ballpark for an upper limit.
+1 I am better off with my 30 year and paying it off early then if I was to do a 15 year right out of the box.
I looked at my situation as a per month basis rather then yearly.
I just factored in my Bills, spending money etc, and saw what was left. Then out of that amount I figured how much I wanted to save and what I’d be willing to use for a mortgage. Took that amount and factored out about $5000 per year for taxes and associations fees. Bamo max comfortable mortgage amount.
Example:
Make $4000 per month bring home.
-500 per month car payment
-1000 per month savings
-1000 per month bills
-500 per month taxes
That leaves you spending about 1K max per month.
So a 200K home with 20% down nets you 160K mortgage at about $975 per month.
Or
A 150K home with ~3.5% down nets you a 145K mortgage at about $975 per month with PMI.
Or
A 104K home with ~3.5% down nets you a 100K mortgage at about $700 per month with PMI
I think these numbers are about right maybe a little high, but check into it yourself a little.
Locking yourself into a 15 year is dangerous. Yeah, you might be able to afford it right now but what about when your situation changes? Have a kid, change jobs, laid off etc. With a 30 you have the flexibility to make the smaller payment if you have to but can continue making larger payments if you want.
I’m rolling out of the housing game. I’m going to dump the one im in now, and I’m looking to buy something small in the 50 range out in the sticks, so I can put up a big building.
I have no need for a huge house, extra taxes, extra cost for utilitys. 1200 sq ft would be more than enough for me.
So I just search exactly where I want to live for 100,000 or less.
You buying a double wide?
My old apartment was 1000 sq ft… 1200 is too small for a house. Good luck ever selling it if it is nice.
I had a 3 bedroom 1200 sq ft house a few years ago, it was more than enough.
The house im in now is too big, its a ranch with 4 bedrooms, 3 of which are never used. I wont have a problem selling it. it should go in the high 80’s
per the double wide comment, hell no. why pay 40g for a trailer when you can pay 50g for a house with over an acre
yo dawg, so you can move without having to move?
:eek:
1200sq ft with 3 bed rooms?! Holy cow. Assuming you had 1 living room and 1 kitchen, that would net you 5- 15x15 rooms inclusive of closets with 1 7.5x10 bath. :eekdance:
this was the house, has a full finished dry basement. it wasnt big, but it was more then enough to just live.
bought it for 25,000 sold it for 38,000 
Awh well if you factor in a furnished basement that helps a lot in that case.
Double your salary and you’ll be fine. Any more than that and you’re going to have to spend the rest of your money wisely.
I think this only works if you have 2 incomes though. My money goes toward everything we need (house, savings, 403b, cars) hers goes toward all the crap we just want. Works out pretty well.
Still works with one income. I split it between three accounts. The bill and necessity money goes into an account with everything auto debited and i never touch it. Savings goes into savings and investments. Everything else goes into my ‘all bets are off’ account.
fixed
I skipped over most of the great advice in this thread that actually answers the original question, I keed. Your Mortgage payment should be roughly half or a little more than half of you net income for the month (ie. double your Salary).
Depending on effeciency of the house you may want to budget $100 for gas, $100 for electric, and $100 for water. They won’t be anywhere NEAR that if you monitor the house and make sure you shut stuff off once in a while.
Don’t forget Garbage…and Taxes if you don’t have Escrow.
Outside of you normal living expenses like food, gas for car, and other misc. shit…you should put away something each week to make a little safety cushion for house expenses.
After all…it is not an investment.
I’m hoping to buy whatever house i can pay off in 2 years with a big down payment. I am 100% against taking 10yr+ to pay anything off. It will never make sense to me to pay $500K for a $200K Home.