We're considering buying a 618k home with a 218k down, so new loan of 400k. We gross 250k+20k bonus annually. So this fits the 3x guideline. The issue is the taxes for this home are nearly 4% of the value, over $1600 added to the monthly payment making my outlay almost 4k/mo.
Do I need to adjust the 3x multiplier for taxes?
I am trying to gauge this via every available metric. Some of the online "what can I afford" calculators are nuts saying we could buy a million dollar home, there's no way.
I put 10% of my salary into a few retirement accounts and we put $1400 into a savings account per month, so net income after that and taxes is about 12k/mo. Dave Ramsey uses the figure 25% of net monthly income for house payment, which makes this 618k home affordable only if I stop saving and knock back my retirement contribution which is just silly.
I've looked at our finances subjectively (categorized all of 2018 finances in ynab) and it's gonna be tight but doable with lifestyle adjustments. I think. So I am trying to combine this subjective assessment with all of the objective affordability calculators, which are giving me totally different result which is causing some real anxiety! :)
Thanks for your help!
Submitted November 03, 2018 at 09:44PM by itzfritz https://ift.tt/2ALysZ3
