How much is your mortgage?

[m&m's mom]

You are more brave than I am.
My DH and I just moved this summer and our house payment went from $950.00 to $1475. That is w/ a third down as well.
Now the house is a very nice 4 bedroom, 3 bath, home w/ a huge kitchen w/ granite, hard wood floors etc. Believe me in Dallas suburb area $250,000 will buy you a nice house.
Our income is in the 6 figures so I would never cut it as close as you are thinking about. It's only a house- should not be a source of stress or worry.
I could obviously care less who knows how much our house payment is or how much we make. My entire family is very open about these things.

 

[katerkat]

Eek! Sounds liked where I grew up in Jersey. Our parents' house sold for what *I* think is a ridiculous amount of money - simply because it had some land (3/4 of an acre, wow!) and was in a very good school district. And it sold five days after going on the market, too.

 

[JayBee]

Originally posted by Toby'sFriend
I can't imagine making a monthly payment that high on less than 6 figures and still having enough money to save for retirement and college.

.

Me either.

Even though you gain $$ from no longer paying daycare...those savings will soon be over....braces, car replacement,car for kid, college, retirement......

 

[Lucky4me]

I think it all depends on your income. If I was making a low 6 figure income, no way would I take on that kind of mortgage. I made a decision to live in a smaller, older home so if anything ever happend to my husband or me, or to our marriage, we could handle the mortgage by ourselves. I'm not suffering, I really like living here and it's nice to pay less than what we would on a 2 bedroom apartment in the area.

I'd think a bit more about this one.

 

[Micca]

There was another mortgage thread here a few weeks ago. I figured that we spend about 7% of our income on the house payment. That is way below what some were suggesting you could/should spend, but it seems like it is plenty each month. We have been in our home nearly 20 years, so our income has increased considerably during our stay here.

 

[mickman1962]

I sold my house of 12 years 2 years ago while prices were skyrocketing in my county. Had another 6 acre parcel over a hill and built a much nicer house doing alot of the work myself and now my mortgage payment is $0. My father told me to buy land as soon as I had the chance since they never make more land. When I bought it land was going for around 3K an acre now the bottom end is 25K. I consider myself very lucky. Now I just have to figure out where to buy land for when I retire in 25 years.

 

[Christine]

Originally posted by melanie18
To answer some questions...

The house we are looking at is $400,000 (average for this area).
The property taxes are $6,000 (again average for this area, but still $2K more than what we are currently paying).
and no, unfortunately it's not by the water. You would think it would be for that price. We would be so much better off moving to Iowa or wherever houses are cheaper, but again, not an option.

My car is only 2 years old and my husbands is 5 (but it's a Jeep and they last pretty long). Having one car is not an option for us with our jobs (he also does landscaping on the side on weekends).

Your area sounds like mine. Ten years ago, I paid $220,000 for my home. We financed a little over $200,000 and got a mortgage for around $1300. Due to tax assessments, that is how mine is around $1445. I must say, I'm ASTOUNDED at your property taxes. I thought I lived in a high tax area at $3500 (my house is now valued at around $400K but they sell for $435,000). So, like you, while I earned a lot of money on the house in 10 years, all the other houses around me are out of this world too. I would like to move, but even with $200,000 as a deposit, I'm still looking a HUGE mortgage. So, I'm staying.

I liked what another poster pointed out--even though you are getting rid of the $700 per month costs, there will be others, I promise you. The braces, the dance, music, sports, etc. They are staggering. And you really don't want to have to cut back there because you are a slave to your mortgage. On the other hand, do you see your income rising significantly?

 

[perdidobay]

DH and I have 2 homes ~so 2 house payments (PITI) that equal 25% of our after tax income. We have no other debt. I would never go over that 25%... it is a good guideline for having money for Life Happens kind of stuff. I also love to travel and would rather have money to do that than a bigger place. We have one 10 year (8years left) and one 15 year (14 years left) mortgage.

 

[Blueeyes101817]

I dont know exact figures, but i am also from south-central new jersey and know from talking to people around here that the prices are ridiculous....but other prts of nj are not...

 

[mom2boys]

Have you actually sat down & prepared a budget based on the new and old mortgages?
What about the things you will need for the move & the new home? Furnishings - not all of them can wait; window treatments; is the house in move-in condition?
You said the jeep is paid off - don't forget to budget repairs for it. (They will come up.)
As others have said, don't count on an extra $700/month just because daycare has ended.

 

[mudnuri]

Okay I just pulled the stuff from my budget.

My mortgage/taxes/insurance/water/sewer is 14.5% of our net income.

We did refinance back in the 90's from a 30 year variable to a 15 year fixed, the reason for our 7 years left.

I will tell you that the only reason we're thinking of selling/moving is the school district, I 100% will not send my DD's to the junior/high school here. We will either move, and eat a bigger mortgage and everything that goes with it, or we'll pay tuition at a private school...(which I really dont want to do).

I still wouldnt do a jump as big as your thinking of doing. WAY to many variables, but that's just me, and I will NEVER be house poor!

Brandy

 

[aprilgail2]

Originally posted by gymnasticsmom68
That's a little personal, I don't even tell my family those kinds of things.

Really?? Wow at work we all sit around and everyone knows what everyone pays for mortgages.....to each his own I guess....
My house is paid off (gift from mom) but I do have a 30,000 home equity loan on it but I only pay 150.00 a month on that one.

 

[FINFAN]

I will also agree that 25% would be my absolute maximum....for us we are at about 19% that is our principal/interest/property taxes, auto ins and homeowners ins., I put them all into the same deposit account...and I freak at what that runs each month! Our property taxes are killing us...most are into double digits around here and with college looming 4 short years away....we should be at 10%....life is what you make it, stay in control. I would also set aside 6 months salary equivalent from the sale of your current home, and then look at what you can afford....you will sleep so much better knowing you have a cushion socked away. Many here have lost jobs or had to take salary cuts..reality sets in after a while. 6 figures is nice if you can get it...many do not even w/2 incomes.

 

[Tink&SquirtsMom]

We made a similiar jump to what you are talking about and have done fine. Still planning two WDW vacations, savings and all that. We made adjustments in other areas, and also had some things change. For example in our new zip code our car insurance is about $100 a month less for the exact same coverage, gas is cheaper on average .05 a gallon (it adds up), etc, etc. Just write up a budget with the new mortgage (a realistic one... if you know you will really want to go to WDW put that in there), and see if you think that will work.

BTW, our housing prices are crazy here too and if we had waited we'd be paying quite a bit more then the $1,000 increase we had for this house now. A house down the street from us (same floor plan, not as many upgrades as ours), just sold in 2 days for $68,000 over what our house was appraised at in MAY of this year.

 

[JayCT]

Real estate is all about location, location, location. You can't compare what someone does in a small city or a rural area to what goes on in the New York area. It is extremely difficult to find reasonably priced housing in a major metropoltan area like NY or NJ. $400,000 may sound like a lot but it isn't when you consider where a property is located and the availability of well-paying jobs in that area.

I grew up in Fairfield County CT and am amazed at the prices of homes in my old neighborhood. Very modest homes (6 rooms, 1 bath) are going for over $400,000 in a blink of an eye. Many are being gutted and expanded or even being torn down to make way for larger more modern homes. It is scary.

You need to look at what your prospects are for the future. If you and your husband have good-paying jobs in a field that is stable and near where you will live, then you are probably making a smart move. There will never be a perfect time to buy a new home. Somethimes you just got to take a chance. If you don't you may seriously regret it.

When we bought our current home, DW couldn't believe we could swing it. She thought I was nuts because I wanted to spend even more. Looking back we should have bought a bigger more expensive home. Would it have been hard at first? Of course, but it would have been worth it. We would have lived in a very comfortable home that we really liked for all those years. Now we are debating whether to stay in this perfectly fine but boring home that we marginally like or uproot our kids in order to build our dream home. I would like to be out of here by 2006 when my oldest changes schools. We will see. Jay

 

[polyfan]

We made a jump in mortgage payments about 5 years ago from $800 to $1750. We prepared ahead of time to see if we could manage it. We started making a $1700 payment on our $800 mortgage each month- so it decreased our principal quicker and it also allowed us to see if we could handle that increase. ONce we saw that we could do it we went ahead and built our new house.

 

[Lisa F]

Originally posted by JayCT
Real estate is all about location, location, location. You can't compare what someone does in a small city or a rural area to what goes on in the New York area. It is extremely difficult to find reasonably priced housing in a major metropoltan area like NY or NJ. $400,000 may sound like a lot but it isn't when you consider where a property is located and the availability of well-paying jobs in that area.

Amen to that. I love it when people who can buy a really nice house for $150k talk about how they would NEVER pay more than xxx for a house. It would be nice if we had that choice, but we don't... our choice is to pay that much for a house OR to pay almost that much for rent. Similarly, our choice was to jump on the housing bandwagon now or wait until we are completely priced out of ever being able to afford a house... so, we stretched a little bit. I would love to have a lower payment but the house we ended up buying, although the nicest we saw, was also the lowest price... we just got very lucky in that regard. I do know some people who waited too long and now they completely can't afford anything. Oh and $6,000/year in taxes is nothing for this area, it seems like many houses in northern NJ and westchester county have taxes double that easily. We looked a bit further north so that we could get more for our money but housing prices are still completely insane even "way up here."

 

[pklein09]

About 6 years ago, we did the same thing....mortgage went from $1400/mo to $2300/month. Taxes went from $4400/year to $9200/year. We also moved from a .16 acre lot/1400 sq. ft. house to a 2.12 acre/2900 sq. ft. house.

Have you considered the tax implications for buying? That's what made it easier for us on the wallet. You will be deducting a larger amount for mortgage interest and a larger amount for property tax. This will have the effect of lowering your taxable income and thereby putting more in your paychecks, making that jump in mortgage payment easier. Talk to someone who can help you figure out these numbers if you can't do it yourself. If you know the numbers in advance, you can change your withholdings now (and have more $ in your paychecks to help offset the increase in mortgage payment) rather than waiting to see how the income tax will fall when you file in Feb/Mar/Apr. It won't make much of a difference for this tax year, but it will make a difference for tax year 2005.

Best of luck! I'm in the same boat in the same part of the state!!!

 

[jel0511]

Originally posted by Lisa F
Amen to that. I love it when people who can buy a really nice house for $150k talk about how they would NEVER pay more than xxx for a house. It would be nice if we had that choice, but we don't... our choice is to pay that much for a house OR to pay almost that much for rent. Similarly, our choice was to jump on the housing bandwagon now or wait until we are completely priced out of ever being able to afford a house... so, we stretched a little bit. I would love to have a lower payment but the house we ended up buying, although the nicest we saw, was also the lowest price... we just got very lucky in that regard. I do know some people who waited too long and now they completely can't afford anything. Oh and $6,000/year in taxes is nothing for this area, it seems like many houses in northern NJ and westchester county have taxes double that easily. We looked a bit further north so that we could get more for our money but housing prices are still completely insane even "way up here."

So true, so true. Actually $400k for central NJ, me and my entire family live here, isn't all that bad. Personally, I think it's pretty cheap, compared to where I live in Central NJ. Here you're looking at minimum of $600k for a 4 bedroom 2 1/2 bath house, in a decent school district. We built our house 5 years ago, and it's worth double what we paid for it. Living in the NY/NJ area, housing prices are astronomical. It is impossible to find decent housing for under $300k, that's just how much it costs to live here. Most of us have families or jobs that won't translate (or move) to lower cost areas of the country, so are stuck paying astronomical housing prices. DH and I looked into moving a couple of monts ago, into one of the best school districts in the state. The house we looked at was over 1 million, and needed around $250K or so worth of work to make it livable. It wasn't a mansion, around 3,000sq ft and had 4 bedrooms. The houses in the same neighborhood that didn't need that much work were going close to $2 million, and this is a regular neighborhood, really nothing fancy. Basically, I'm priced out of the market, even with having my house double in price. The idea of taking on a mortgage in the over $500k range, makes me want to puke! The payments and taxes are astronomical, not that mine are all that great!!! In some places, for what my house is worth, I'm sure I could live in a mansion, in other places, like San Francisco, Southern CA, even Northern NJ, the amount of money I could sell my house for, would buy me a shack. Yep, a shack. In those places, especially Northern NJ, a decent 3 bedroom is running $750k or more!!! It's absolutely nuts here, and that's why most people are staying put, because it's just too darn expensive to move!!!

 

[Mskanga]

The more I read this thread, the happier I am to live where I live and pay what I pay.