So we will have a student loan payment instead of car loans...

[ScrimpAndSave]

As many of you know, I am getting married in 9/09 and I am currently trying to figure out what our financial situation will be like. He is getting out of law school and will be starting at $42,000 a year and I will be at $60,000. He has about $140,000 in student loans...but I guess on the bright side, we each have newer model cars that are paid off in full and no credit card debt.

I've been saving like a maniac ($2,000 a month) trying to get a downpayment for a home together. We will probably live with my father for a year and then buy a house. I'm hoping to have 20% down for a house...and I would like it if I could keep my monthly mortgage payment with the principal, interest, taxes and insurance at or below $2,000.

I'm saving for my wedding on top of this...and I am only a few thousand dollars away from that goal.

I'm just trying to keep on truckin'...

[creditcardfree]

Nice job! Sounds like your current home savings will end up being your mortgage payment. Do you have a plan of attack on the student loans?

[ScrimpAndSave]

Nice job! Sounds like your current home savings will end up being your mortgage payment. Do you have a plan of attack on the student loans?

Well...the student loans are half private and half gov't. The gov't loans are about $66,000 at 6.8 and private ones are $63,500 at 8.2. When it consolidates, the monthly payment will be about $800-$900 each month. I know - a lot.

When we get married, I will have about $30,000 saved (that is what I have planned at least). We are going to live with my father and pay him $400 rent each month (this is what I am paying now). A year from then, at around January 2011, we should have about $80,000 saved up...and that is when I think we should make out first home purchase.

I've been toying with the idea of putting 10% down on a $200,000 when I get married since I will have another $10,000...but I guess it is best to be patient.

[jIM_Ohio]

Well...the student loans are half private and half gov't. The gov't loans are about $66,000 at 6.8 and private ones are $63,500 at 8.2. When it consolidates, the monthly payment will be about $800-$900 each month. I know - a lot.

When we get married, I will have about $30,000 saved (that is what I have planned at least). We are going to live with my father and pay him $400 rent each month (this is what I am paying now). A year from then, at around January 2011, we should have about $80,000 saved up...and that is when I think we should make out first home purchase.

I've been toying with the idea of putting 10% down on a $200,000 when I get married since I will have another $10,000...but I guess it is best to be patient.

You may not want to consolidate the loans. If you were going to pay extra on them, unless the new rate is lower than the lowest rate you have now, keeping them seperate will make it easier to pay them off early.

For example when I graduated I had loans of 8.25% (variable), 8.25%(variable), 9.25% (variable) and 4% (variable-sub and unsub stafford). Payments of $200-$200-$100 and $325 (total borrowed approached 80k).

I had offers to consolidate at around 5-6%. I had to work a long time to get the 8.25 and 9.25 loans down to manageable level. Then I paid one of them off and snow balled the other two. Within 5 years those 3 were gone and the stafford were left and took another 3 years to pay off.

I would just advise before you consolidate run some spreadsheets with a what if. Sometimes consolidation makes sense, other times it might cost you money (by lengthening term, increasing overall interest rate or similar).

[ScrimpAndSave]

Jim thanks so much for the info. We are only going to consolidate if it means a lower interest rate.

I'm just really concerned to know how much of a monthly payment we can afford for a house...I'm thinking that with EVERYTHING (PITI), $2,000 should be our max.

[jIM_Ohio]

Jim thanks so much for the info. We are only going to consolidate if it means a lower interest rate.

I'm just really concerned to know how much of a monthly payment we can afford for a house...I'm thinking that with EVERYTHING (PITI), $2,000 should be our max.

My SL prevented me from getting a big house until the debt was gone. Granted I was single and paying off 80k of debt on a salary which was half that. One more reason to keep the SL seperate. I did not need all my loans paid off, just some of them.

I realize you have some big hopes and high expectations
1) getting married
2) getting a house
3) being financially sound

if you can do 1 of the 3 coming out of school-good
if you can do 2 of the 3 at the same time- GREAT
if you are thinking of all 3, realize the stress you might be causing yourself. Moving and marriage are considered two of the top 3-5 most stressful things you will ever do (loss of loved one, new job and poor health would be the other 3).

If you delayed the house even 6 months, maybe 18 months and funnelled the $2000 mortgage payment you budget into the expensive student loans, you might see a clearer picture.

1) you will get to know your spouse before deciding on a house.
2) the first 5 years of marriage are the toughest. Seriously. people told me that and I agree.
3) Even if you have the down payment available, that does not mean you need to spend it immediately.

No idea what religious beliefs, society values or similar you are dealing with from standpoint of living with fiance before marriage and similar. I do not mean to impose or imply anything by this ... I lived with my wife for around 3 years before we got married (known wife for about 9 years and been married for just over 6). I thought things were good when we were engaged... but over the 6 years we learned a lot about each other which
a) affected the type of house we should have bought
b) affected how we each deal with debt
c) affected communication between us
d) affected how other married couples saw us and interacted with us.
e) if kids are in the picture (or future) these factors will all get amplified as well.

For example I made the decision to buy me a condo when we were going out. She looked at the condo with me and lived with me when we moved in. But had I known then what I knew now I might have reconsidered both the size and location of the condo. Might have waited another 1-2 years (we were engaged a year later) and gotten a SFH. My point is you might know something now together, but in 3 years your life will be VERY different than it is now, so you might not want to lock in some relative permanent things (it is tough to liquidate a house without incurring high expense).

The path I took worked out OK for me. It probably was not the most efficient path to get me to where I am financially though.

For example after choosing where to move being single, I chose location based on school district. Turns out my wife wants to send kids to private school. That did not come up until around year 2 or 3 of marriage.

Lower school district might have saved us 100k or 200k on purchase of same house. We were not aligned because when I was single I thought of me and a little about the future and when married you might not realize the nth degree of passion one spouse has on one issue or another.

[ScrimpAndSave]

Hey Jim,

Thanks again for the info. Like I said, I am trying to be patient. The wedding is in the plans and the bulk of it is paid for by my father...we are just paying for flowers, DJ, photographer etc. And you are right...there are a lot of live changes happening not mention the fact that he is graduating from law school in May 2009 and he is also taking the bar over the summer and starting a job as an associate in November (two months after we are married)...

...I guess it is smart to just put the whole house thing off...

[ScrimpAndSave]

Oh and ps. we absolutely do NOT want kids.