You are a shrewd dude elsewhere...I'm with the contingent that support you for not getting in over your financial head...it is true that buying a house is a wise investment but it should be an investment that makes you feel good and not overly stressed...life has enough stress.
Bad news about the house. : /
Keep in mind that 28% is what is usually allowed for you mortgage. 36% is allowable as your total debt-income ratio. There are a lot of factors to consider before making this decision. Do you have a car payment? Do you plan on having a car payment? Do you have revolving debt? Student/Parent Loans..etc? If you don't, 33% is not unreasonable. But of course, the biggest factor is your comfort level.
Don't completely rule out renting for a year, if necessary. A lot of people will tell you it's better to own a home you don't want than to rent, but that's usually not the case. Depending of rent prices in your area, your short term goal may be to spent the least amount of money possible. Mortgage loans are so front loaded with interest, you hardly pay any principle the first few years. Now assume your appreciation is $10k for one year (I think that's generous based on my area). Sounds great, but after paying realtors, and transfer stamps (based on your area), you may be upside down. So if you own a house for less than a year, you may actually have to pay to sell it.
I'm sure you'll make the right decision. I've had a few interesting experiences buying and selling, I just wanted to add my perspective. Good Luck.
What is scarry is that the company that is building the house is trying to talk me into buying it anyway! They are saying: "Don't worry... a 33% debt ratio is not all that bad! You can do it! Lets just give the mortgage people your pay stubs from when you were doing contract work instead of your current pay stubs."
hmmm, it's probably a blessing in disguise, considering you would be doing business with people who want you to commit FRAUD. Sorry ya have to lose this one, but as the saying goes - "deals are like buses, if you don't catch this one, there will be another by in 10 minutes."
"deals are like buses, if you don't catch this one, there will be another by in 10 minutes."
That is a lesson I learned many years ago... and it has served me VERY well.
Elsewhere: so sorry to hear about your dream house!!!
When NOdenial and I relocated almost 2 years ago, he got a substantial raise.....I was working, but since I knew we would be living in a "remote area" I suggested we just consider his income for the home. That worked out quite well to stay in a certain "budget" and not live above our means.
Since we have been here our house has been appraised $110,000 more!!!
I have to agree that realestate is the best way to invest your money.
Hopefully you will find another "dream house" that won't make you eat Ramen (I love Ramen but not every night)
I think you made a wise choice to hold off on the house. I think it sucks that realtors and mortgage people will fanangle and wiggle to squeeze a family into a home. Then something happens, the family looses their house, and are out. The dealers thought still get their cut.
Good luck in the future.
Try camping and save, no mana served though
although i know a peson who went for 20 years on potato exclusively.
I tell you what i can eat just about anything i want but my preferred dish is boiled potato,
prefered because that all i can cook..., (I don't even know how to peel them off), with canned tuna, canned shrimp, canned oysters, got it?,
totally satisfied with the ample menu, never felt better in my whole life,
or is it just because i am an exjw?
Hell i even tried hot blood sausage a couple of times at a country side restaurant.
BUT what you need to buy a house for, the END is near...
Or you can buy a lot, build a one room house and expand as you get rich.