Buying 900K SFR in Irvine - advice needed

I might be the only one but it does seem like with the income you posted,  that you are really stretching it.

I thought the general rule was mortgage shouldn't be more than 3-4x your income... and it looks like you are close to 5x.

There are other factors obviously and I hope that you can make it. Congrats and good luck.
 
I agree with what Iho said.. Seems like a stretch but I hope everything works out for your family in the long run. 

I didn't go through your first initial posts so I apologize if I missed these... Any kids? Vacations? How's your savings for the long run?  Some of these expenses could really put you in the red..

Wish you much luck!

 
It's only for 1.5 years, with a newborn that time will fly by. When the husband graduates his income in theory could go all to retirement and investments.  She probably could have gotten the same/similar price and interest rate in 1.5 years but if she likes the house and they can swing for 1.5 years why not? If an energency comes up sounds like they can borrow from family or take out a heloc against that 20% down
 
qwerty said:
It's only for 1.5 years, with a newborn that time will fly by. When the husband graduates his income in theory could go all to retirement and investments.  She probably could have gotten the same/similar price and interest rate in 1.5 years but if she likes the house and they can swing for 1.5 years why not? If an energency comes up sounds like they can borrow from family or take out a heloc against that 20% down
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I can't even stomach that lol
 
Congratulations on your home!

alchemist said:
Hi All,

thanks for your responses, advice, and perspective. The seller ended up having multiple offers so we didn't get the price we were hoping for (900k) but after multiple counter offers, we ended up outbidding everybody by offering an extra $22k. hahahah. my spouse and I were so set on not going past $905k but there's something terrible about trying to outbid everybody + really wanting the house. we put 20% down despite the VA loan. we had been saving up the money for the last 5+ years so why not.

We're going to be house poor for the next couple of years but we won't ever be in the red as long as I keep my job. My job is pretty stable. Since this forum seems pretty anonymous, I guess it doesn't hurt to provide our incomes - in case it may help someone else who's in the same situation as us. I earn $120k/year + 15% bonus and my spouse brings in $25k/year from the VA benefits. so we are definitely somewhere in the middle class. we're still in disbelief that we purchase a home for almost a mill but we plan on raising our kids in the same home for the next 30 years so we don't mind the idea of not being able to eat out all the time and forgo a couple of vacations/year for our future kids.
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Congratulation on your home! If a marriage could survive being house poor then you truly found your mate for life.

I would hope you will have some extra spending money for date, vacation and occasional surprises of buying her a nice bag. These little things would keep the romance alive even though she said she does not want them. 
 
alchemist is a she..

irvinehomeshopper said:
Congratulation on your home! If a marriage could survive being house poor then you truly found your mate for life.

I would hope you will have some extra spending money for date, vacation and occasional surprises of buying her a nice bag. These little things would keep the romance alive even though she said she does not want them.
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There's not a single standard on what is "middle class", but some have defined it as earning between 67% to 200% of State median income.  In CA this means earning between $40k to $120k/year.  Because cost of living varies greatly from location to location, "relative middle income" to local cost of living also varies greatly.

If your combined household income exceeds $120k/year and has the ability to put $180K down on a $900K house, you're probably above "upper middle class" by State, but not necessarily local standards.  Was it a smart financial decision?  It's too early to tell because in this type of situation, those that come out ahead will say "that was a smart move" and those that end up catching falling blades will say "crap".  If I had a working crystal ball that could predict these things, I'd be rich.

Speaking from personal experience, I had my income drop from 6 figures to taking 40% pay cut in 2008-2009, and it took years to recover.  When SHTF, it hits hard, doesn't matter if it's economic down turn or an earthquake.  You could be homeless very quickly.  So it's good to always be prepared and being smart about it.  I've known Preppers who spent hundreds of dollars on MRE's, only to find that it gives them painful constipation, or the meat patty smells/tastes like cat food (joke to tell your husband).
 
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