I was saying that your situation is an example of why our system is nuts. Why? For one, because you say that you won’t be able to increase your downpayment much over the next few years, so that means you have little future savings available to pay for housing. Since you also don’t have the current price of what you want to buy in cash, my conclusion is that you cannot afford to buy a house for that price. You don’t have the money now, nor do you have the saving power necessary to pay for it in the near future. Yet you consider it normal and rational to buy it anyway. You probably are not unusual. That this kind of behavior is normal in our society is, to me, nuts.
[/quote]
But I am looking to fulfill 3 of the most commonly believed requirements for a rational home purchase, 1. 20% down; 2. home price = 3X gross income (500K); 3. debt to income ratio 28%. Isn’t that enough?! Ok, I understand I don’t have cash reserves beside the downpayment, but I can actually get cash if need be from retirement,life insurance. I am not perfect, but I think I will do ok and pay my mortgage.
I explained above where my money goes – is actually saved/invested for college, insurance, retirement, not spent recklessly. If I wouldn’t put those money there maybe I could pay my mortgage off sooner *if* I wanted to.
I think you may have a problem with 30 yr fixed rate loans then, that THEY shouldn’t exist – if you think I should be able to pay it off in a few years. It’s your opinion, but I think you are going too extreme in the opposite direction.
