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What would u do?

Posted By Message

jame0801
LIF Toddler

Member since 5/11

428 total posts

Name:

What would u do?

A little background....we have been renting a house for a while. We have 3 kids. The reason we have rented is because we struggled to save up for the down payment enough where we could afford the loan. Also we needed to get our credit scores up from when my DH had lost his job years ago and we fell behind.

Fast forward to now. Our credit scores are good and my amazing incredible parents offered us a gift for the remainder of the down payment (to add to what we saved). Our lease was coming to an end and honestly its just time already. I want my kids to grow up in a home and I dont want to move again.

So with that said we have been looking and found the "perfect" house for us. Same neighborhood (dont have to switch my kid's school) plus the block is very desirable where I live. Here is the question....our monthly payments will be $300 more a month than what we paying in rent. My DH is stressing about this because at our current rent we feel like we always tight. Here is the thing...I just accepted a job that Im starting in a few weeks that Ill be bringing in a lot more money a month ($2000 more) and I plan on trading my car in for a smaller one with a lower payment. I know $300 is a lot but the inventory is so low of houses right now and this house checks all the boxes for my family. I think today we will be getting the accepted offer (fingers crossed!) and I just want my DH to feel as excited as I am.

I guess Im not really looking for answers but more needing justification from others right now lol. Thanks!

Posted 8/31/17 7:41 AM
 
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MegZee
My bunny

Member since 5/06

8770 total posts

Name:
Meaghan

What would u do?

Do you have a written budget? Anytime DH and I are discussing a major purchase we turn to our budget- it helps seeing it in black and white.

Also remember that you now will have to deal with home maintenance- do you have an emergency fund? You WILL have to replace things (roof, furnace, appliances)- we put $300 a month in a house maintenance fund, and we are always dipping into that. Just something to think about.

Good luck!

Posted 8/31/17 8:10 AM
 

GoldenRod
10 years on LIF!

Member since 11/06

25197 total posts

Name:
Shawn

Re: What would u do?

Also keep in mind that your salary will (hopefully) go up every year, but your mortgage payment won't. What is barely affordable now will be easier in a few years.
It doesn't justify overspending now because you might be able to afford it later on, but it's something to consider.

As PP mentioned, emergency funds are critical when you own a house. Major repairs happen at the worst times, and they often can't be ignored or postponed. If your furnace dies in January, you can't wait 6 months to get it replaced....

Good luck! Chat Icon

Posted 8/31/17 8:21 AM
 

mommy2be716
LIF Adult

Member since 1/16

2686 total posts

Name:

What would u do?

is the payment $300 more per month including taxes? You also have to factor in gas/oil, electric, and water. I assume you weren't paying for that in your rental? Also, if you're starting a new job, does that mean you're also going to be paying for a babysitter now? Or did you work before?

We had a $2000 expense that we didn't prepare for when we first moved, and a few other smaller expenses in the 3 years since we've been here. Also, when we first closed, our taxes were almost 3k more than what we thought they were because the couple before us had veteran's discounts on their taxes so it was not an accurate representation. That made a big difference in our monthly payment

Message edited 8/31/2017 9:28:07 AM.

Posted 8/31/17 9:27 AM
 

jame0801
LIF Toddler

Member since 5/11

428 total posts

Name:

Re: What would u do?

Posted by mommy2be716

is the payment $300 more per month including taxes? You also have to factor in gas/oil, electric, and water. I assume you weren't paying for that in your rental? Also, if you're starting a new job, does that mean you're also going to be paying for a babysitter now? Or did you work before?

We had a $2000 expense that we didn't prepare for when we first moved, and a few other smaller expenses in the 3 years since we've been here. Also, when we first closed, our taxes were almost 3k more than what we thought they were because the couple before us had veteran's discounts on their taxes so it was not an accurate representation. That made a big difference in our monthly payment



We pay all of our utilities now. And no I dont have to pay for a babysitter. The $300 extra includes taxes.

Posted 8/31/17 10:56 AM
 

jame0801
LIF Toddler

Member since 5/11

428 total posts

Name:

Re: What would u do?

Posted by MegZee

Do you have a written budget? Anytime DH and I are discussing a major purchase we turn to our budget- it helps seeing it in black and white.

Also remember that you now will have to deal with home maintenance- do you have an emergency fund? You WILL have to replace things (roof, furnace, appliances)- we put $300 a month in a house maintenance fund, and we are always dipping into that. Just something to think about.

Good luck!



Yes we do...and we actually sat last night and saw where we could cut costs. Adding to the fact that Im bringing in more money we are still ahead of the game. I like the idea of the emergency fund. I will definitely add that into the budget.

Posted 8/31/17 10:58 AM
 

chilltocam
LIF Adult

Member since 11/11

8142 total posts

Name:

What would u do?

Will you be bringing home an extra $2000 per month (net income) or is that $2000/month gross (before taxes)? I think that extra income (especially if it's net) will make a big difference and allow you to afford the house

Posted 8/31/17 12:01 PM
 

loveus
LIF Adolescent

Member since 9/13

684 total posts

Name:

What would u do?

Time it is a no brained to buy the house. I would do whatever needs to be done to make it work. You will have something instead of rent receipts.
Also you never know if your landlord will raise your rent or sell and then you will be in another situation,

Posted 8/31/17 12:39 PM
 

mommy2be716
LIF Adult

Member since 1/16

2686 total posts

Name:

Re: What would u do?

Posted by jame0801

Posted by mommy2be716

is the payment $300 more per month including taxes? You also have to factor in gas/oil, electric, and water. I assume you weren't paying for that in your rental? Also, if you're starting a new job, does that mean you're also going to be paying for a babysitter now? Or did you work before?

We had a $2000 expense that we didn't prepare for when we first moved, and a few other smaller expenses in the 3 years since we've been here. Also, when we first closed, our taxes were almost 3k more than what we thought they were because the couple before us had veteran's discounts on their taxes so it was not an accurate representation. That made a big difference in our monthly payment



We pay all of our utilities now. And no I dont have to pay for a babysitter. The $300 extra includes taxes.



Oh then definitely go for it! You will be able to handle it with the new job for sure. Good luck!

Posted 8/31/17 1:01 PM
 

jame0801
LIF Toddler

Member since 5/11

428 total posts

Name:

Re: What would u do?

Posted by mommy2be716

Posted by jame0801

Posted by mommy2be716

is the payment $300 more per month including taxes? You also have to factor in gas/oil, electric, and water. I assume you weren't paying for that in your rental? Also, if you're starting a new job, does that mean you're also going to be paying for a babysitter now? Or did you work before?

We had a $2000 expense that we didn't prepare for when we first moved, and a few other smaller expenses in the 3 years since we've been here. Also, when we first closed, our taxes were almost 3k more than what we thought they were because the couple before us had veteran's discounts on their taxes so it was not an accurate representation. That made a big difference in our monthly payment





We pay all of our utilities now. And no I dont have to pay for a babysitter. The $300 extra includes taxes.



Oh then definitely go for it! You will be able to handle it with the new job for sure. Good luck!



Thank u :)

Posted 8/31/17 3:42 PM
 

jame0801
LIF Toddler

Member since 5/11

428 total posts

Name:

Re: What would u do?

Posted by chilltocam

Will you be bringing home an extra $2000 per month (net income) or is that $2000/month gross (before taxes)? I think that extra income (especially if it's net) will make a big difference and allow you to afford the house



Its Net (after taxes)

Posted 8/31/17 3:43 PM
 

chilltocam
LIF Adult

Member since 11/11

8142 total posts

Name:

Re: What would u do?

Posted by jame0801

Posted by chilltocam

Will you be bringing home an extra $2000 per month (net income) or is that $2000/month gross (before taxes)? I think that extra income (especially if it's net) will make a big difference and allow you to afford the house



Its Net (after taxes)



That's a BIG monthly increase. I'd go for it!

Posted 8/31/17 4:51 PM
 

RainyDay
LIF Adult

Member since 6/15

2871 total posts

Name:

What would u do?

Go for the house

Posted 8/31/17 5:01 PM
 

LuckyStar
LIF Adult

Member since 7/14

6285 total posts

Name:

What would u do?

This is a no brainer to me. Of course go for the house.

Posted 8/31/17 8:00 PM
 

BabyBearA
LIF Adult

Member since 7/11

1249 total posts

Name:

What would u do?

Buy the house!

Posted 8/31/17 8:48 PM
 

StaceyWill
It's a girl!!!

Member since 6/10

20964 total posts

Name:
Stacey

What would u do?

100% buy that house!!

Posted 8/31/17 11:22 PM
 

TwinMommyToBoys
LIF Adult

Member since 12/16

2059 total posts

Name:

What would u do?

With that increase go for it! That's big!

Posted 9/1/17 8:52 AM
 

CSK
LIF Adolescent

Member since 9/11

882 total posts

Name:

Re: What would u do?

Are you currently paying all utilities at the place your renting?

electric, cable, heat, water, lawn maintenance et al.


Basically those are all yours now, so whatever you're not paying would be additional $ out of pocket. Same with house maintenance.

have you factored in home owners insurance and taxes?

is the $2000 more a month gross or net. What would the net be?

I'm not saying don't do it, just go into it eyes open. Increase in salary may seem like a lot but if its gross rather than net, it is much less than $2k.

you'll also likely get a tax benefit from owning a home that initially could be worth a few hundred a month, it really depends on how close you are to itemizing as it stands and how much in additonal deduction you will get from owning a home.

Posted 9/1/17 11:41 AM
 

Aries14
Can't plan life...

Member since 8/08

2858 total posts

Name:

What would u do?

go for the house! Sounds like you guys waited long enough and are as ready as you could be!

Posted 9/1/17 12:15 PM
 

Momma2015
Mommax2

Member since 12/12

6289 total posts

Name:

Re: What would u do?

Posted by Aries14

go for the house! Sounds like you guys waited long enough and are as ready as you could be!



Agreed! I'd do it!

Posted 9/1/17 1:24 PM
 

jame0801
LIF Toddler

Member since 5/11

428 total posts

Name:

What would u do?

Thanks everyone!! We are still negotiating (they countered again ugh!)but we are going to cross our fingers that by the end of the weekend this should be worked out. I really love this house!

Posted 9/1/17 5:32 PM
 

JandJ1224

Member since 6/06

5810 total posts

Name:
Jannette

Re: What would u do?

Not sure if this was mentioned but you'll be writing off interest and real estate taxes now with homeownership. You should review numbers with your accountant and you can change deductions to take home more in monthly pay.

Posted 9/2/17 8:16 PM
 
 
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