{ "media_type": "text", "post_content": "I need to stop stress dry heaving. Bought my first house with mortgage of $5,000 a month. I make $190k/year base and fiancée makes 100k. Is the mortgage to income ratio ok?", "post_id": "60390d4f7f49360022e10cc3", "reply_count": 111, "vote_count": 9, "bowl_id": "5e6fe1c31f5e51001d267e46", "bowl_name": "Coronavirus Work-life" }

I need to stop stress dry heaving. Bought my first house with mortgage of $5,000 a month. I make $190k/year base and fiancée makes 100k. Is the mortgage to income ratio ok?

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Op after tax you and wife will get about $200k a year (including the mortgage deduction). After mortgage, HOA and taxes you'll have $140k left. You can then afford to: lease a porsche, get a mistress, blow an eight ball every morning, bath in champagne, sponsor a child, take tennis lessons, summer in the hamptons. Maybe I'm a complete retard but I don't understand why people are acting like you're in a strained financial situation. Not to mention your bonus and annual raise.

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Because women can budget.

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With the combined income of $290k, after taxes, insurance and 401k contributions (hopefully you contribute to your 401k), I would estimate the take home pay to be $188k annually (15k+ monthly). So after $5k mortgage, PMI, home insurance and property tax, you still have $10k left monthly, the income vs house payment ratio is very reasonable. The issue is the $30k down payment, it means you are not financially responsible enough, and that needs to change quickly with a house. Do you have emergency fund set aside after the down payment? With $15k take home pay, where does the money go? Layout everything out in a spreadsheet, forget about books or apps, just list out all the bills, credit card transactions, and cash spending, etc. Differentiate between mandatory vs discretionary spending, then come up with a plan to cut down the discretionary spending. Plan your budget based on your spending history instead of recommendation from books or apps, no one know better than you what works for you. But aim to set aside $5k a month to build up your emergency fund ($40k to $50k would be good), once you are there, aggressively pay toward the mortgage to build up equity. Once you are at 20%, refinance to get rid of the PMI and get a lower interest rate.

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You already bought it right? So what difference does it make? Rather than stress about it figure out what changes you could potentially make in your budget to ensure you are ok month to month. I personally wouldn’t have spent that much of my income on a house but I don’t think you’ll be eating dog food or anything. Real issue is how will you save for emergencies. There’s always emergencies with a house.

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You should crunch the numbers to see if you can carry the mortgage on a single income (and cover other expenses). When my husband and I bought, we bought under that assumption. I make a little more money than I did at the time but I’m now the sole breadwinner since my husband is launching a business. And I’m very glad we did it that way.

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Yeah that’s a lot, esp with the expenses/MX that will come with that place. My wife and I make around the same as you and your fiancée, and our mortgage is just shy of 3k. Are you planning to start a family any time soon and potentially take a leave from work (either you or fiancée)? Could make it next to impossible

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Yeah, OP says elsewhere they are a lawyer, shows how small my world is 😁 that didn’t even occur to me

You’ll be just fine. Your mortgage payment is only 20% of your income. Remember you’ll get some $ back come tax season, too.

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SM2 Definitely. The changes in tax laws hurt homeowners in blue states disproportionately, where property taxes are typically higher.

$30K down with a net household income of $300K is idiocy. Have fun paying PMI for the life of the loan, or having to refinance and lose your sub 3% interest rate. You need to save $$$ quickly to refi now, into a 10% conventional loan and lender paid MI (half a point).

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Mortgage insurance is like $125/m per $1m these days. Not great, but the numbers don’t change much.

I have two ways of answering this question for you: 1) if you are actually stress dry heaving, then maybe you bought a bit high. 2) My mortgage+taxes+insurance is ~25% of my take home pay and has never been a stressor. Just a data point.

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C1 and Solution Arch1: I agree with both of you. I wanted to give the data point from the perspective of net salary and what helps me sleep at night. I find pre-tax sometimes misleading when it comes to “am I spending too much“ questions.

You make $300k a year but can't do basic math and a quick Google search...

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I wanted to hear people’s opinions on this app.

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Why so much? My wife and I barely make $200k and I just bought a house in Nova for $840k and my mortgage is $3795. You’ll be fine... Edit: nvm just read other details. We had a $100k down payment and no PMI due to VA loan. But stilll, you guys make a ton of money. You’re fine

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Do it before you make partner — more money doesn’t solve behavior problems.

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The debt/income ratio seems fine but look at your other major expenses and re-evaluate how you spend so that $5k a month seems as reasonable as it should with that massive income.

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DC area is challenging. You'll be ok but one of your paychecks (or 2) will go to house every month. I really hope you've downgraded on vehicle expenses. We have similar income in Arlington VA and just became a one car household because we both WFH. My recommendation: live very frugally for 6 months to pay down PMI.

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Thank you!

OP, my fiancé and I just bought a place (in CA) with a mortgage(+tax impounds & HOA) monthly cost of approx $3.3k and a combined income of $190k base. We did the numbers and are comfortable with it even though I still have significant student loans (I’m a 2nd yr). I think your monthly cost is reasonable, you’ll be ok!

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You’ll be fine... enjoy your new home! Spouse and I bought in CA and we make a combined $290k and our mortgage+property tax+HOA is $5k. We also both have student loans and still have plenty left for savings, investments (incl maxing out 401k), etc. My only advice is to try to rebuild your emergency savings as fast as possible.

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So let me ask you this, after you two pay your Mortgage, PMI, HOA, property Taxes, Utilities, Homeowners and Auto insurance, car payment, cell phone, student loans, and/or anything else that has to be paid, how much take home pay do you have left?

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OP where is the house and how much is it for?

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PMI is so low now, ours was $100/m on 800k home. When we refinanced 2-3 years in and it went away, it effectively was an extra 3k or so lost like all the other closing costs. I don’t know area, is avoiding high HOA possible? Sucks to add new forever costs that don’t go to your wealth line.

Housing cost burden is considered by HUD to be 30% of pretax so by that standard you are totes fine

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You will be fine, MD is great and has plenty of potential. Enjoy the American dream!

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Nothing to stress about

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I assume your are a first year BigLaw associate with that salary. Did you factor in potential changes in salary if you don’t stay in BigLaw long term? (Granted these are all assumptions).

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Good work, A3!

That would make me stress too as my house is half that. But my combined car and home is about that and I cure any stresses with the vroom vroom.

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Can I ask, was this a jumbo loan? How did you get a conventional loan for so much with such a small down payment? Is the max convention loan amount higher in the DC area?

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It’s an FHA jumbo loan. Besides that, my answer to the rest of your questions is 🤷‍♀️.

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