What percentage of your net income should go towards a home mortgage?
Lets say you have $5000 coming in per month, how much is a safe amount to spend on a mortgage, while still saving some for car payments, other loans, insurance, groceries, emergencies, etc? My dad said a 1/4 of your net income is a good idea per month to spend on your home payments...agree? disagree?
- itsjustmeLv 71 decade agoFavorite Answer
Your father is exactly correct! Listen to him! The people on here that recommend, 33% as a mortgage payment are also the ones who have contributed to the mortgage crisis in this country today! 33% of your net income is too much. It doesn't leave you any buffer.
- Anonymous5 years ago
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As you asked; Lets say you have $5000 coming in per month, how much is a safe amount to spend on a mortgage,
while still saving some for car payments, other loans, insurance, groceries, emergencies, etc? My dad said a 1/4
of your net income is a good idea per month to spend on your home payments...agree? disagree?
Best of Luck :)
- 1 decade ago
I agree with about 25%, especially if you might have car payments and other expenses. It is also a good idea to have a cushion in savings, so when an emergency comes up you can cover up to 6 months of the mortgage payment.
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- Unsub29Lv 71 decade ago
I absolutely agree with your dad. 25% is perfect. It's very hard to do these days because of high home prices. It's not uncommon to see people with 33% or even higher mortgages/income. I would do all you can to stay out of that situation though.
- Josie826Lv 71 decade ago
I agree with dad, 25% is a good figure. Anymore and you will be financially strapped to the point where all you are doing is working to pay your mortgage and other bills and having nothing extra to play. One other thing, will your house payment include your taxes and insurance or will you be saving that monthly and paying it when it is due? We pay approximately 30% for our mortgage, which includes our property taxes and house insurance.
- Anonymous1 decade ago
33% is usually the max anyone recommends, but 25% is much safer. My mortgage payment is about 20% of my income, and I find it extremely comfortable.
- estielmoLv 71 decade ago
The guiding percentage used to be 25 but was commonly altered to 33.
But you need to sit down and figure out what YOU can afford and how tight you are willing/able to live.
Never buy more house than you can afford NOW.
- Oswald WLv 61 decade ago
One can only honestly say that this would depend on the amount that is left over to meet all the essentials, other Bills and Food.. If one is on a small income the greater part of that income will be taken up by Mortgage
- 6 years ago
I must not make enough 1/4 of my NET is nada!