How much house do you have?

[edd_tv]

First post in while. Life has gotten significantly busy in the last few months. The wife and I just welcomed twins into our life. Its been a blessing beyond belief. Im 29, been with UPS since I was 18, full time for the last 3 years. Been married for 4 years. Just starting out with kids, we plan on these being the last. They are 6 months old now.

The time has come to upgrade our housing situation. My wife worked before the kids came, but now we plan on her staying home. Im debt free other than my mortgage now. I figure I could sell my house and walk with about 15k, and we have another 10k at least to throw at a new place, if not more. Anywho, Im looking for some other driver input on how much house they pay for. I dont want to be a slave to the house payment, as I love being able to not have to worry about wether or not I can put food on the table.

Without getting specific, what is the average mortgage payment you guys have? When you bought did you factor your payment on your base pay only or do you have to work x amount of hours a week to get by? I dont want to back myself into a corner financially. I talked with a bank and got pre approved for over 22ok just on my salary. Im in the midwest housing is reasonable. 22ok buys alot.

 

[moreluck]

We've always stuck to the rule of thumb.......house payment should be no more than one quarter of your pay check. That way there was enough for the basics and a little savings.

 

[Scottyhawk]

As an ex loan officer I always used 25-30% of gross based salary. I have seen as high as 40 but would not reccomend that, lower the better, especially if you are only going to have single income and DO not do a variable or balloon loan, fixed 30 rates are pretty good?

Good luck with the twins

 

[Jones]

Why do you need to upgrade your house? I mean if you have to then you have to, but think how much you can put away for the future by staying right where you're at. Max out your 401K and still have plenty left over to squirrel away in a savings account, emergency cash, college funds, etc. My mortgage is way low compared to a lot of people's, just under $600, but I would love to be able put all that money somewhere else. My advice would be to get the smallest cheapest place that meets your requirements.

 

[edd_tv]

I didnt need a yard when I bought the place I have now, and I only have one bathroom. Perfect for my bachelor days, but I ve outgrown it now.

 

[moreluck]

I didnt need a yard when I bought the place I have now, and I only have one bathroom. Perfect for my bachelor days, but I ve outgrown it now.

You need a 3-bedroom, 2 bath house....minimum. Those twins will want their own rooms before you have a chance to blink.
That's an ex-realtor's opinion. Interest rates are low now....get the house room you need. If you have to go buy another house later, the interest rates could be higher.

 

[UpstateNYUPSer(Ret)]

The rule of thumb when I bought my house was two times your annual salary.

 

[upsman2940]

No doc loans are the best!!

 

[Catatonic]

You've had very good advice been given so far.
A house use to be an investment but it is no longer that.
It is a life-style choice and my advice is in line with what others have advised -
Buy no more house than you have too,
Try to get one built recently with good insulation and low utilities
Get one you can pay off with a 15 year loan (or less).

Don't let a house be an anchor around your neck.

 

[cachsux]

Are you urban or rural? What's 220k in some cities is something else out in the boonies. Are you willing to drive to work? Factor in gas/vehicle expenses to do so versus paying that same amount for a higher priced house thats closer. At least that money, in effect , will still be yours. Or would you rather drive and have some land in a more quieter setting? There's some of that in everyone on here. Are you skilled at working on a home or do you need to have someone do it for you? No shame if not but factor that in and consider a newer home versus a fixer upper. Obviously look at schools, taxes, crime, jobs close by as I'm sure your wife might want something to keep busy with when the kids go to school. It's a big list.

That being said my personal expieriance with homes was to buy and restore and then flip for profit towards the next one. But then again that was before the housing market crash also. What I would say is since you are in no real hurry and those little buggers will be easy to manage for a little while is take your time. It's a buyers market so look around. Something perfect for you is out there just take the time to look for it.

 

[Brownslave688]

I pretty much have the same advice as everyone else I wanted to keep my house payment under what I bring home on my average paycheck. This has worked out just fine for me. While my wife was working we lived pretty large and just spent as we pleases. Now that she's back in school full time we have to watch a little more. I have about $200 a week taken out in 401k and stock money so there is always wiggle room there if I need it.

 

[trplnkl]

There has been some really good advice given here, I see none that is bad advice in my opinion. One thing I haven't seen suggested about your wage intake being the bases of the payment is that you should not rely of overtime, base on the 40 hour week. I know that UPS is not likely to reduce the hours but OT is not guaranteed in any day or week. I know that the 40 hours are not guaranteed either but is more reliable.

 

[packageguy]

We've always stuck to the rule of thumb.......house payment should be no more than one quarter of your pay check. That way there was enough for the basics and a little savings.

perfectly said,