Mortgage advise needed (first time)

[Eagle]

What would you all do?

Hey Element926 welcome!

In order to buy a house I'd recommend:

1. 20% down payment to avoid PMI (Private Mortgage Insurance)
2. 6-12 months of an emergency fund (cash in the bank in savings)
3. Your payment should be 25-30% of your net income (take home pay)
4. Your house should be no more than 2 to 3 times your annual income.
5. Pay off your house with a 15 year mortgage instead of a 30 year.

[JoeP]

Ok, I'll ask: Why on earth do you have a car loan 27k ($800 per month) when you're making $120k a year? You could easily free up a huge portion of that by selling whatever it is and buying a dependable used car for $12k. Then after you pay off the remainder of your old car loan, you'll have more cushion so that a 15 year mortgage will be more feasible.

[Eagle]

Ok, I'll ask: Why on earth do you have a car loan 27k ($800 per month) when you're making $120k a year? You could easily free up a huge portion of that by selling whatever it is and buying a dependable used car for $12k. Then after you pay off the remainder of your old car loan, you'll have more cushion so that a 15 year mortgage will be more feasible.

I agree with you JoeP. Some thoughts from Dave Ramsey in the book or audiobook Total Money Makeover:

“A new $28,000 car will lose about $17,000 of value in the first four years you own it. That is almost $100 per week in lost value. To understand what I’m talking about open your window on your way to work and throw out a 100 dollar bill.”

“Taking on a car payment is one of the dumbest things people do to destroy their chances of building wealth. The car payment is most folks largest payment except for their home mortgage. So it steals more money from the income than virtually anything else.”

“Looking good is when you’re broke friends are impressed by what you drive. Being good is having more money than they have.”

“You have to reach the point that what people think is not your primary motivator. Reaching the goal is the motivator.”

[Destind4]

“You have to reach the point that what people think is not your primary motivator. Reaching the goal is the motivator.”