Can I afford to take out a mortgage?
December 18, 2013 1:12 PM Subscribe
I make about $46,000 in Seattle, WA. Monthly take-home pay, excluding overtime which automatically goes into a savings account, is $2,800. I have no debts and no significant non-optional recurring expenses. At some point in the next few months, I will have about $150,000 in cash after splitting the equity in a home that is being sold. Assuming that I can put that amount toward a down payment, can I afford a mortgage? Before I contact my lender, is it even wise for me to take one out? I've been looking at a few suitable homes in North Seattle priced at or below $275,000.
posted by anonymous to Work & Money (15 answers total) 2 users marked this as a favorite
If it's relevant, I've been at my new job for three months. My salary will increase to about $76,000 over the course of the next three and a half years, with scheduled raises every six months, and I have decent job security, and medical and pension benefits. However, I want to stick to a budget based on my current earnings so that I can afford to take longer unpaid time off.
I may end up with significantly more than $150,000 since the equity money is entirely separate from my divorce settlement, but I plan to invest any additional funds for retirement as I'm almost 30.
My credit score is ~730. I could probably raise it if I got a credit card, but that would take a long time. Apartment living is not a great option due to my side work (income from that is sporadic and not included in the above budget) and hobbies and the fact that my dog looks like a breed that is not allowed in most managed apartments.