New South WalesYou might be surprised to learn that you can buy a house in NSW for under $50,000! Simply head to Broken Hill to strike gold. There's a couple of options here, including this $30,000 cottage in the centre of town.
As you can see, a salary of $50k is considered good money. However, there is ample room for improvement if you want to improve your situation. The average household income is approximately $63k. Therefore, a salary of $50k is considered below average.
Simply take your gross income and multiply it by 2.5 or 3, to get the maximum value of the home you can afford. For somebody making $100,000 a year, the maximum purchase price on a new home should be somewhere between $250,000 and $300,000.
The rule of thumb is you can afford a mortgage where your monthly housing costs are no more than 32% of your gross household income, and where your total debt load (including housing costs) is no more than 40% of your gross houshold income. This rule is based on your debt service ratios.
To determine how much house you can afford, most financial advisers agree that people should spend no more than 28 percent of their gross monthly income on housing expenses and no more than 36 percent on total debt — that includes housing as well as things like student loans, car expenses and credit card payments.
Typically, mortgage lenders want you to put 20 percent down on a home purchase because it lowers their lending risk. It's also a “rule” that most programs charge mortgage insurance if you put less than 20 percent down (though some loans avoid this).
At a 4% fixed interest rate, your monthly mortgage payment on a 30-year mortgage might total $477.42 a month, while a 15-year might cost $739.69 a month.
Monthly Payments by Interest Rate and Loan Payoff Length. Amortization schedule table: $ 160,000 30 Year loan at 5 percent. 858.91 per month.
Mortgage Loan of $120,000 for 30 years at 4.35%
| Month | Monthly Payment | Principal Paid |
|---|
| 1 | 597.37 | 162.37 |
| 2 | 597.37 | 162.96 |
| 3 | 597.37 | 163.55 |
| 4 | 597.37 | 164.15 |
The additional amount will reduce the principal on your mortgage, as well as the total amount of interest you will pay, and the number of payments. The extra payments will allow you to pay off your remaining loan balance 3 years earlier.
Cons of Paying Your Mortgage Off Early
- You lose liquidity. Liquidity refers to how easy it is to access and spend the money you have.
- You lose access to tax deductions on interest payments.
- You could get a small knock to your credit score.
- You cannot put the money towards other investments.
Monthly payments on a $300,000 mortgageAt a 4% fixed interest rate, your monthly mortgage payment on a 30-year mortgage might total $1,432.25 a month, while a 15-year might cost $2,219.06 a month.
Let's say you borrow $250,000.00 on a 30 year loan at 4.000% interest. With this amount being borrowed, you would pay a total of $435,473.77 for the loan. This means you will pay $4.84 each month for every thousand dollars borrowed.
Current Mortgage and Refinance Rates
| Product | Interest Rate | APR |
|---|
| 30-Year Fixed-Rate Jumbo | 2.875% | 2.918% |
| 15-Year Fixed-Rate Jumbo | 2.625% | 2.704% |
| 7/6-Month ARM Jumbo | 2.25% | 2.646% |
| 10/6-Month ARM Jumbo | 2.375% | 2.639% |
