I wanted a gut check on a new potential mortgage and budget.
This is for the suburbs about an hour south of Boston, with moderate cost of living. The home is for myself (32), my wife (32), and 2 year old son and we plan to keep the house for a long time, as our family is all local and that is important to us.
Salary: $90k + $5-10k annual bonus
Proceeds from sale of current condo: $130k
Cash on Hand: $175k
Retirement 401k/IRA/HSA: $195k
Home Price: $450k
Down Payment: $225k (50%)
Interest Rate: 3.1%
Mortgage Payment including property Tax, Interest, Insurance: $1500
Down payment is comprised of $130k from condo sale + $95k cash = $225k
Add in $15k for furniture and projects, I would end up with:
$65k in cash savings/emergency fund
$1500 monthly payment on a $7500-$8000 monthly gross income
$3200 total expenses per month including mortgage, health insurance, utilities, car insurance, car maintenance, cell phones, groceries etc
No car payments, no CC debt
I feel like this checks the boxes for DTI, income:mortgage and other rules of thumb, mostly due to the 50% down payment
I plan to continue aggressively saving for retirement with remaining monthly funds.
We plan for my wife to go back to work at least part time in the next few years, but this isn’t guaranteed so I am planning exclusively on my income.
Any thoughts or critiques?