I guess in the condo market, at least, say a $325,000 condo at 6% 30yr fixed. Even assuming no money down for the sake of argument, this pencils out to:
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Unfair comparison. Scenario isn’t accurate. The LTV is key.
Any loan above 80% is going to have MI added, making the effective rate much higher than 6%, probably higher than 7% (Add $200+ mo)
You are also going to pay a higher rate above 90.01%-95% LTV, and even higher at 95.01%-100%.
With 20% down, ($65,000) THEN you can get a loan for 6%, IF you qualify. Payment will be $1559 + $271 (Lost interest on the $65K)= $1830..+ 550 above= $2380
If you don’t have $65,000 down, credit above 680, reserves beyond the 65K, and stable income you may not qualify anyway for that rate.
If you do qualify, you will need at least $5,000 mo. income to qualify, assuming that you have no other monthly debts.
A lender will still qualify you for a loan that is a higher % of income than is wise.
Whether it’s home or condo, you will have extra costs for maintenance, and condos can become a worse investment.
