Buying our first home?

[myrdale]

Starry, a couple of rule of thumbs I have heard in the past:

1) Your mortgage should not be more than x2 your total annual (gross) income.
$75k x 2 = $150k Max

2) Your mortgage payment should not be more than 25% of your monthly income (for a 15yr fixed, but I would personally consider it for a 30yr fixed).
(Guessing) $3,500 x 0.25 = $875

As for your down payment, personally I paid $8k down on a $108k house, about 7-1/2%, I've never been too hung up on the necessity of 20% down, though I do think it is worth while for you to have some skin in the game.

Additionally I would be a bit more conservative on this one point: I would consider the above numbers based on one income alone. If either of you lost your job you're going to be in world of hurt.

Honestly I'd avoid buying this house. Buy something more reasonable. In 10 years when you got two kids running around, and you both know you have stable jobs, consider moving up then.

[Bright]

Starry, a couple of rule of thumbs I have heard in the past:

1) Your mortgage should not be more than x2 your total annual (gross) income.
$75k x 2 = $150k Max

2) Your mortgage payment should not be more than 25% of your monthly income (for a 15yr fixed, but I would personally consider it for a 30yr fixed).
(Guessing) $3,500 x 0.25 = $875

As for your down payment, personally I paid $8k down on a $108k house, about 7-1/2%, I've never been too hung up on the necessity of 20% down, though I do think it is worth while for you to have some skin in the game.

Additionally I would be a bit more conservative on this one point: I would consider the above numbers based on one income alone. If either of you lost your job you're going to be in world of hurt.

Honestly I'd avoid buying this house. Buy something more reasonable. In 10 years when you got two kids running around, and you both know you have stable jobs, consider moving up then.

The above is great advice. I also second buying a home that is affordable on one income. That rule served us very well. You can move up in house later. The banks in my opinion will always give you more than what one can comfortably afford. The math on buying this home at this time looks too risky too me personally.

[CashUp Sammy]

My opinion for what it's worth.
Plain and simple, you can't afford a $219,000 house at the $70,000 income level regardless if you have 20% down or not. You should be looking at something half that price or less, or just rent and save for a while.

Renting and saving for a while is always a tough ask. Especially here in Australia, where we have arguably the most expensive houses going around. Feel sorry for the young folks out there.

[wemakehome]

Hi Starry, It is difficult to say without knowing your annual income.If you want for loan or buying your 1st home or mortgage ,there's alot more to home ownership costs than your monthly mortgage payment such as taxes, insurance, PMI, plus closing costs, and realtor fees upon sale and many more.Your thought is good.Nice and simple.Go ahead with your thoughts.