I have a good salary ($250k plus bonus) but limited savings for down payment. Realistically could I afford a $1m house with 5% done using upcoming bonus with FHA loan? Or will closing costs and others be super high too? Any tips for someone with decent amount of income or just a case of saving more for down-payment?

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So do you have 50k liquid cash? Your question is tough to decipher. Are you going to buy a 1mil house or do you have the option to get a cheaper one . What's the goal here ?

likesmarthelpful

Lot of factors to discuss here.. Talk to a lender that can walk you through the numbers and such. Are you just throwing out $1m, or are you looking at one? Depending on where you’re looking to buy / how many units, you may not be able to get an FHA loan for that amount. Feel free to DM me w any questions.

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How much do you spend/save per month? Budgeting could be 90% of your problem. I use mint.com to track my spending. I also avoid expensive cars and jewelry.

Agree with Mint. And it’s free. The trending option is very helpful once you have all your accounts/cards connected

How much are you willing and able to pay per month to cover principal, interest, tax, insurance and HOA? With just 5% down, you may pay up to $7k a month on your mortgage for PITIH. Can you afford to do that without stretching yourself pretty thin? Do you have enough emergency savings to cover a rainy day? Is your current job stable? The rule of thumb I have heard is to not spend more than 28% gross income monthly or 25% net income monthly (more aggressive) on PITIH. Have you considered purchasing a home that is maybe cheaper, i.e., in the $700k to $800k range instead. Still quite expensive but gives you some room to breath.

just to confirm - when you say you have enough for 5% down for a $1M home - are you considering closing costs as well? because your cash to close will likely be at least ~$75k.

another thing to note - and i’m not a real estate professional or in the mortgage industry - but I’m pretty sure this would definitely qualify as a “jumbo loan” which will introduce additional complications / factors to consider as well.

my recommendation would be to look at a lower price target, if you can. or take some more time to continue saving.

On income numbers like you’re mentioning, a house is a sensible use of that money. Typically the financing numbers will look better and better with a high money down payment. Up to you but many people will get a house as soon as their income level is high enough and they clear the minimum amount required for a down payment on the property they decide they want

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