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This is exactly why our economy is in the dumps

L

LuckyTaxi

Diamond Member
A coworker making less than $80k ALONE somehow managed to get approved for a $300k house! Wife doesn't work and I know he's VERY frugal. He mustv'e saved a lot of money for a downpayment but buying $3 sweaters and living like a hermit doesn't sound like a life to me.
 
Originally posted by: LuckyTaxi
A coworker making less than $80k ALONE somehow managed to get approved for a $300k house! Wife doesn't work and I know he's VERY frugal. He mustv'e saved a lot of money for a downpayment but buying $3 sweaters and living like a hermit doesn't sound like a life to me.
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Exactly. So what is the problem?
 
this is the perfect scenario. More hard capital and less credit. It is the credit buying that kills the economy, since debt is what is holding it up. You get a few people who suddenly think they shouldn't pay for whatever reason, then the profits that were slim to begin with get eaten up by writing that debt off. Get enough of those people and now you have what we are stuck in now.

Compound that with sending money overseas for goods and services, you have even a bigger problem. Trust me, not shopping isn't the problem, it is shopping with credit that has brought us to our knees (or at least stooping, since we still have it a lot better then other countries)
 
What's the problem? You said yourself he lives frugal which means he has a lot saved up. He then used these savings to make a downpayment on a $300k house for which he has a mortgage of ($300k - savings). This is exactly how you're supposed to do it and is NOT the reason why the economy is in the dumps.
 
Frugal guy can afford $300k house... not seeing the problem here.
Aren't the savers the ones who actually help the economy in the long run (provided they actually spend the money eventually)?
 
<a target=_blank class=ftalternatingbarlinklarge href="http://cgi.money.cnn.com/tools/houseafford/houseafford.html">How much house can you afford?
</a>

Looks reasonalbe to me how he can afford it. Assuming he has this income for 30 years.

Gross annual income: $ 80,000
Downpayment amount: $ 30,000
Monthly debt:
(eg. student loan, credit card payments) $
Mortgage rate: % 5.9
Annual property taxes: $ 3500
Annual homeowner insurance: $ 481



-------------------------------------CONSERVATIVE ----------------- AGGRESSIVE
Minimum house price: $...............258,779.67................................344,978.08
Loan amount: $...........................258,779.67................................314,978.08
Monthly mortgage payment..............1,534.92....................................1,868.2
Taxes/homeowner insurance: $...........331.75......................................331.75.
Total monthly payment: $.................1,866.67...................................2,200

 
What is wrong with that situation? His payment should be about 1800\month while he should be netting close to 5K. He is consuming ~36% of his income for a house payment.

/shrug
 
I have no idea what the OP considers to be a problem. 300k isn't too bad of a loan with less than 80k salary. How does that screw up our economy?
 
Originally posted by: LuckyTaxi
A coworker making less than $80k ALONE somehow managed to get approved for a $300k house! Wife doesn't work and I know he's VERY frugal. He mustv'e saved a lot of money for a downpayment but buying $3 sweaters and living like a hermit doesn't sound like a life to me.
Click to expand...

Out of curiosity, why do you presume to know everything they make? I make almost double what others think I make simply because I have a part-time side business as a consultant, so when I drive a car worth half of my "professional" salary and people get all angry, it makes me laugh quite a bit - especially since I paid for the entire thing in cash. 😉
 
Originally posted by: Fmr12B
On $80K a year a $1,800 a month house payment seems easily doable.

He is far from stretching himself.
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Yeah, I'm not exactly sure what the problem is with this one. The guy has plenty of money to live a comfortable life with that mortgage; unless he is leaving out that the guy also has seven kids.

The problem is people making $20-30k, sometimes even less, were getting approved for loans for $300k houses.
 
Is the a parody thread? The people doing exactly the opposite of this person the OP mentions is why this economy is in the dumps. He purchased within his means.
 
Originally posted by: LuckyTaxi
A coworker making less than $80k ALONE somehow managed to get approved for a $300k house! Wife doesn't work and I know he's VERY frugal. He mustv'e saved a lot of money for a downpayment but buying $3 sweaters and living like a hermit doesn't sound like a life to me.
Click to expand...

Hmmm.. He sounds like a guy who's riding out the recession by skimping where it doesn't matter (fashion) and making the right decisions. good on him!
 
It could be affordable with new homeowner credits, if he has no debt, and he had a downpayment. His payments would be in the $2000-$2500/month range.
 
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