How much downpayment required

[CafeMoto]

How much downpayment is now required (what is the minimum) for a first time homebuyer? Some year soon I would like to buy in San Diego and envision spending at least 500K to get in. What are closing costs like? I presume I should just keep saving as I have 50K in savings, 100K in 401k, and make 100K a year. I’ve paid off my school loans, car, & credit cards but would like to keep a safety net of 25K. Should I really be looking at houses for 3-400K pushing me inland? Please fire off your candid thought on what you think I can afford. My income is expected to be stable but not foreseen to grow. Like everyone here being close to the coast is important. Should I get a realtor and see what is out there? Redfin & others do not make me feel optimistic. Someone told me there can be 20-40 offers on most decent affordable houses. A twin style townhouse might be ok but an apartment style condo is what I want to avoid owning.

[temeculaguy]

Cafe, how old are you, are you married, do you have kids and if not are any of these things possibilities in the next 5-10 years? The answers will affect my advice.

You can get away with 3% and can work all kinds of deals with the closing costs, so that can vary, but you can squeak in with 25k total and keep your safety net. Ignore the 401k money, that’s not part of this formula.

But the real question is, are you a 500k homeshopper and my answer is no, I apologize but that’s my advice.

I’m not even good telling you to look at 400k, not even 350k.

If you are going minimal down, and you make 100k, your ceiling is 300-325k, 3x earnings borrowed max, the ultimate fundamental.

Pushing you inland??? You are gonna get more than pushed baby, welcome to Temecula!!!!

[temeculaguy]

Cafe, how old are you, are you married, do you have kids and if not are any of these things possibilities in the next 5-10 years? The answers will affect my advice.

You can get away with 3% and can work all kinds of deals with the closing costs, so that can vary, but you can squeak in with 25k total and keep your safety net. Ignore the 401k money, that’s not part of this formula.

But the real question is, are you a 500k homeshopper and my answer is no, I apologize but that’s my advice.

I’m not even good telling you to look at 400k, not even 350k.

If you are going minimal down, and you make 100k, your ceiling is 300-325k, 3x earnings borrowed max, the ultimate fundamental.

Pushing you inland??? You are gonna get more than pushed baby, welcome to Temecula!!!!

[temeculaguy]

Cafe, how old are you, are you married, do you have kids and if not are any of these things possibilities in the next 5-10 years? The answers will affect my advice.

You can get away with 3% and can work all kinds of deals with the closing costs, so that can vary, but you can squeak in with 25k total and keep your safety net. Ignore the 401k money, that’s not part of this formula.

But the real question is, are you a 500k homeshopper and my answer is no, I apologize but that’s my advice.

I’m not even good telling you to look at 400k, not even 350k.

If you are going minimal down, and you make 100k, your ceiling is 300-325k, 3x earnings borrowed max, the ultimate fundamental.

Pushing you inland??? You are gonna get more than pushed baby, welcome to Temecula!!!!

[temeculaguy]

Cafe, how old are you, are you married, do you have kids and if not are any of these things possibilities in the next 5-10 years? The answers will affect my advice.

You can get away with 3% and can work all kinds of deals with the closing costs, so that can vary, but you can squeak in with 25k total and keep your safety net. Ignore the 401k money, that’s not part of this formula.

But the real question is, are you a 500k homeshopper and my answer is no, I apologize but that’s my advice.

I’m not even good telling you to look at 400k, not even 350k.

If you are going minimal down, and you make 100k, your ceiling is 300-325k, 3x earnings borrowed max, the ultimate fundamental.

Pushing you inland??? You are gonna get more than pushed baby, welcome to Temecula!!!!

[temeculaguy]

Cafe, how old are you, are you married, do you have kids and if not are any of these things possibilities in the next 5-10 years? The answers will affect my advice.

You can get away with 3% and can work all kinds of deals with the closing costs, so that can vary, but you can squeak in with 25k total and keep your safety net. Ignore the 401k money, that’s not part of this formula.

But the real question is, are you a 500k homeshopper and my answer is no, I apologize but that’s my advice.

I’m not even good telling you to look at 400k, not even 350k.

If you are going minimal down, and you make 100k, your ceiling is 300-325k, 3x earnings borrowed max, the ultimate fundamental.

Pushing you inland??? You are gonna get more than pushed baby, welcome to Temecula!!!!

[CafeMoto]

thanks TG, you pegged it, married, 35, kid on the radar for next year. Wife brings another 50k but I want to factor her out of the income as she will ultimately work less and we don’t want to get into more payment than we should. Reason I ask today is we understand the house we rent now will go up for sale in the spring. your advice was much appreciated even if the truth stings

[CafeMoto]

thanks TG, you pegged it, married, 35, kid on the radar for next year. Wife brings another 50k but I want to factor her out of the income as she will ultimately work less and we don’t want to get into more payment than we should. Reason I ask today is we understand the house we rent now will go up for sale in the spring. your advice was much appreciated even if the truth stings

[CafeMoto]

thanks TG, you pegged it, married, 35, kid on the radar for next year. Wife brings another 50k but I want to factor her out of the income as she will ultimately work less and we don’t want to get into more payment than we should. Reason I ask today is we understand the house we rent now will go up for sale in the spring. your advice was much appreciated even if the truth stings

[CafeMoto]

thanks TG, you pegged it, married, 35, kid on the radar for next year. Wife brings another 50k but I want to factor her out of the income as she will ultimately work less and we don’t want to get into more payment than we should. Reason I ask today is we understand the house we rent now will go up for sale in the spring. your advice was much appreciated even if the truth stings

[CafeMoto]

thanks TG, you pegged it, married, 35, kid on the radar for next year. Wife brings another 50k but I want to factor her out of the income as she will ultimately work less and we don’t want to get into more payment than we should. Reason I ask today is we understand the house we rent now will go up for sale in the spring. your advice was much appreciated even if the truth stings

[Scarlett]

I am in a similar situation, similar income though older with young kids and both of us are working full time (and plan to continue so). You should find something for which the total PITI (yes, add property taxes and mortgage and house insurance to your principal+interest) is comparable to your rent, which I assume you are pretty comfortable paying (but take into account your wife may not work anymore). Then work your numbers backwards from there. That’s what you can afford. (If you are not saving any money with current rent plus your wife’s income, then you should reduce the PITI amount by at least $500-1000).

I don’t know where you work and how comfortable you are commuting long distances, but it may not make sense to buy somewhere where the commute is over 1 hr one way. We owned a townhome and once we had kids we didn’t want for each of us to spend 45′ each way at rush hour commuting. We wanted to spend as much time as we could with the kids, plus all the chores that come along with it. So we sold. And I wouldn’t buy there that far from work again, at least not until my kids are in college. I set my commute time limit to 30′, tops.

Given your situation, I’d continue to rent something small another 2-3 years and save more money – ideally until your child starts preschool or kindergarten. Defnitely wait until you have the kid(s), your life will change dramatically. You will realize how expensive kids can be – if they grow out of something, then there is something else that costs more money than it should. Then you will figure out where you are – income/jobs wise, as well as how much your expenses are(college funds, daycare, activities…). Hopefully by then the coastal houses, and 56 corridor (PUSD) (that’s where we are looking) will go down some more.

Good luck!

[Scarlett]

I am in a similar situation, similar income though older with young kids and both of us are working full time (and plan to continue so). You should find something for which the total PITI (yes, add property taxes and mortgage and house insurance to your principal+interest) is comparable to your rent, which I assume you are pretty comfortable paying (but take into account your wife may not work anymore). Then work your numbers backwards from there. That’s what you can afford. (If you are not saving any money with current rent plus your wife’s income, then you should reduce the PITI amount by at least $500-1000).

I don’t know where you work and how comfortable you are commuting long distances, but it may not make sense to buy somewhere where the commute is over 1 hr one way. We owned a townhome and once we had kids we didn’t want for each of us to spend 45′ each way at rush hour commuting. We wanted to spend as much time as we could with the kids, plus all the chores that come along with it. So we sold. And I wouldn’t buy there that far from work again, at least not until my kids are in college. I set my commute time limit to 30′, tops.

Given your situation, I’d continue to rent something small another 2-3 years and save more money – ideally until your child starts preschool or kindergarten. Defnitely wait until you have the kid(s), your life will change dramatically. You will realize how expensive kids can be – if they grow out of something, then there is something else that costs more money than it should. Then you will figure out where you are – income/jobs wise, as well as how much your expenses are(college funds, daycare, activities…). Hopefully by then the coastal houses, and 56 corridor (PUSD) (that’s where we are looking) will go down some more.

Good luck!

[Scarlett]

I am in a similar situation, similar income though older with young kids and both of us are working full time (and plan to continue so). You should find something for which the total PITI (yes, add property taxes and mortgage and house insurance to your principal+interest) is comparable to your rent, which I assume you are pretty comfortable paying (but take into account your wife may not work anymore). Then work your numbers backwards from there. That’s what you can afford. (If you are not saving any money with current rent plus your wife’s income, then you should reduce the PITI amount by at least $500-1000).

I don’t know where you work and how comfortable you are commuting long distances, but it may not make sense to buy somewhere where the commute is over 1 hr one way. We owned a townhome and once we had kids we didn’t want for each of us to spend 45′ each way at rush hour commuting. We wanted to spend as much time as we could with the kids, plus all the chores that come along with it. So we sold. And I wouldn’t buy there that far from work again, at least not until my kids are in college. I set my commute time limit to 30′, tops.

Given your situation, I’d continue to rent something small another 2-3 years and save more money – ideally until your child starts preschool or kindergarten. Defnitely wait until you have the kid(s), your life will change dramatically. You will realize how expensive kids can be – if they grow out of something, then there is something else that costs more money than it should. Then you will figure out where you are – income/jobs wise, as well as how much your expenses are(college funds, daycare, activities…). Hopefully by then the coastal houses, and 56 corridor (PUSD) (that’s where we are looking) will go down some more.

Good luck!

[Scarlett]

I am in a similar situation, similar income though older with young kids and both of us are working full time (and plan to continue so). You should find something for which the total PITI (yes, add property taxes and mortgage and house insurance to your principal+interest) is comparable to your rent, which I assume you are pretty comfortable paying (but take into account your wife may not work anymore). Then work your numbers backwards from there. That’s what you can afford. (If you are not saving any money with current rent plus your wife’s income, then you should reduce the PITI amount by at least $500-1000).

I don’t know where you work and how comfortable you are commuting long distances, but it may not make sense to buy somewhere where the commute is over 1 hr one way. We owned a townhome and once we had kids we didn’t want for each of us to spend 45′ each way at rush hour commuting. We wanted to spend as much time as we could with the kids, plus all the chores that come along with it. So we sold. And I wouldn’t buy there that far from work again, at least not until my kids are in college. I set my commute time limit to 30′, tops.

Given your situation, I’d continue to rent something small another 2-3 years and save more money – ideally until your child starts preschool or kindergarten. Defnitely wait until you have the kid(s), your life will change dramatically. You will realize how expensive kids can be – if they grow out of something, then there is something else that costs more money than it should. Then you will figure out where you are – income/jobs wise, as well as how much your expenses are(college funds, daycare, activities…). Hopefully by then the coastal houses, and 56 corridor (PUSD) (that’s where we are looking) will go down some more.

Good luck!

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