so my manager must not have gotten an FHA loan, but that was a possibility for my co-worker? gotcha...

 

I'm married with two kids but we're a single income family. When I bought my house, it was roughly 2x my salary at the time (now down to about 1.7x my salary). It's fairly comfortable overall - I don't worry about whether I can make my payment, that's for sure.

When you go for a loan, they'll tell you everything you need. Don't worry it about it until you get to that point. I probably faxed 60 or 80 pages of documents when I went through the process...

 

I was just reading the Washington Post real estate chat. Someone asked this question. That old rule of 2.5 to 3 times your income doesn't work because interest rates make a big difference in your monthly payment. The hosts said you should pay *no more than* 28% of your monthly gross income on your mortgage. Plus, these days you need to save nine months of living expenses in case of emergency, unemployment, etc. Takes longer to find a job now. So you may want to take that into consideration when deciding how much you can afford.

 

My house cost 1.6X my salary, but I put 20% down. Since I live in a low tax state, my mortgage payment including taxes is about 1/4 of what I call my take-home pay (the $ that goes into my checking account after 401-K, FSA, and a couple of other automatic savings distributions).

The thing that was going through my head as we were house shopping was that I didn't want to be "house broke." Only you know how much money you want to not have anymore...

Don't forge that you'll be spending stupid money on maintenance. For example, I spent $700 on fence parts at Lowe's this evening, and the mower won't start. Oh, and I need a chainsaw.