I’m a single guy earning $145,000 a year, and I currently have $195,000 in a high-yield savings account. I’m looking to buy a house for $505,000 and plan to make a down payment of $130,000. I don’t eat out frequently, go to bars, go to movie theaters, or travel internationally much. I don’t smoke or drink alcohol either. Can I afford this house? Currently, my rent is around $2,500 without utilities.
Based on your income, it sounds like you’re in a pretty good position. Your debt-to-income ratio will be key here.
Zen said:
Based on your income, it sounds like you’re in a pretty good position. Your debt-to-income ratio will be key here.
What’s a good debt-to-income ratio to aim for?
Zen said:
Based on your income, it sounds like you’re in a pretty good position. Your debt-to-income ratio will be key here.
What’s a good debt-to-income ratio to aim for?
Ideally, under 36% total debt-to-income, including your mortgage. So calculate your monthly payments and other debts to see where you stand.
Don’t forget to factor in property taxes, insurance, and maintenance costs. They can add up quickly, so make sure you include those in your budget.
Harold said:
Don’t forget to factor in property taxes, insurance, and maintenance costs. They can add up quickly, so make sure you include those in your budget.
Good point! I’ll make sure to account for those additional costs.
With a $130K down payment, your mortgage should be around $375K. Depending on the interest rate, your monthly payment could be manageable.
Pax said:
With a $130K down payment, your mortgage should be around $375K. Depending on the interest rate, your monthly payment could be manageable.
I’ll definitely check current mortgage rates to see what my monthly payment would look like.
Since you have a solid savings cushion, you’ll be better prepared for unexpected costs too. Just be mindful of how much you’re willing to spend monthly.
Lei said:
Since you have a solid savings cushion, you’ll be better prepared for unexpected costs too. Just be mindful of how much you’re willing to spend monthly.
Thanks! It’s good to hear that having savings can be a plus.
I think you’re in a good position, but it’s always a good idea to consult with a financial advisor or mortgage broker to get personalized advice.
GRAY said:
I think you’re in a good position, but it’s always a good idea to consult with a financial advisor or mortgage broker to get personalized advice.
I’ll definitely consider that. I want to make sure I’m making a smart decision.