Using this as a retort is totally missing the point.
Ok so I only have to save up 7,000 now, so I can do it in 6 years, I guess. But that extra 1800 a month I'm continuing to save each year afterwards by forgoing my late doesn't actually cover the 7% APR on the additional loaned 33,000
(interest rates only high as of recent, but still)
Using this as a retort is totally missing the point.
The person I was replying to was saying it would take 30 years at that savings rate to have enough money for a down payment. You do agree, it wouldn't take 30 years to have a downpayment right? Like, we've now both done the math, and found its significantly less than 30 years, right?
And actually, at 6.96% for a 30 year FHA loan, the added payment for the additional $33,000, is ~$218/mo. $1,800/yr is $150/mo, so it covers 68% of that amount if you're looking at it that way. Cut out another ~$2.26/day or $68/mo and you'll have completely covered it while owning a house. But I'd look at it this way, your mortgage taking out a $293,000 loan is ~$1,950. Property tax rates vary a lot, but we'll add ~$3k/yr to that (250/mo), budget $3k/yr for repairs as well, so $2,450/mo in the end. What are you paying for rent? How much of that are you keeping as equity?
And yeah, property taxes will probably tick upwards a bit, you might need more repairs than budgeted here, but chances are you'll refinance your mortgage and cut that part down to like $1,300/mo or even less in several years if interest rates fall to like 4% or lower. Is your rent going to get lower?
Ok so I only have to save up 7,000 now, so I can do it in 6 years, I guess. But that extra 1800 a month I'm continuing to save each year afterwards by forgoing my late doesn't actually cover the 7% APR on the additional loaned 33,000
(interest rates only high as of recent, but still)