A: A general rule says you should not spend more than 30% of your income on rent. Read: Rents Increase, Spurred By and Falling Home Ownership.
Debt & Liabilities
A: The mortgage lending limit is determined by both your income and your monthly debt obligations (which includes all loan payments). These two numbers are used to determine your debt-to-income ratio (DTI). In general, the proportion of your gross income that can apply to debt service (principal, interest, taxes, insurance, and HOA) cannot represent more …View Article
A: This depends on how long you keep the mortgage. You can calculate the breakeven period quickly by dividing the cost of buying down the rate by the monthly savings. The longer you stay in the house (without refinancing again), the more it makes sense to buy down the rate. Keep in mind that, on …View Article
A: A reverse mortgage is the only way to borrow money against the equity in your home without ever having to make a payment. A reverse mortgage can reduce financial stress and/or improve a retiree’s standard of living. The loan, plus interest, gets paid back when the last remaining homeowner passes away or moves out …View Article
A: There is no consensus among well-known financial planners on this issue. My advice would generally be to try to pay your mortgage off by the time you retire. This gives you the mortgage interest deduction while you are working, acts as a form of forced savings, and gives you the opportunity to downsize or …View Article