Young Homeowners Crushed by Mortgage Debt
Young adults and couples are struggling with significant mortgage debt, often acquired during transitions like divorce or early homeownership. High interest rates and fluctuating market values create anxiety about affordability, investment opportunities, and long-term financial stability. Many are questioning their initial decisions and seeking advice on navigating these complex financial pressures.
SOURCES (60)
“My wife and I (34FM) are in the market for a new house. We currently have about $150k left on our mortgage with an "estimated" value of $430k. $325k in savings/retirement with 2 kids and a third on the way. We have been gifted with…”
“I'm not sure how the law would break down for non married joint owners but I would imagine a 50/50 asset split in that case default and then lawyers can argue about the rest. Could be a good deal for whoever contributes less. Bad deal for whoever contributes more. I'm also a non married joint owner but if we ever split she can keep the house. Shes definitely spent more on it than I have.”
“So you'd spend $500k on a house and have $500k less in investments? Put a 20% down payment and you can get the appreciation on the house and have $400k in the s&p500.”
“You need to invest and save as much as you can. Later on you can decide if you want it for a house or something else, but might as well start saving. If it's not possible with 20% down you simply put more money down which is why you need to save a lot and let it compound. Put it in s&p 500 and hope that in 6 years it has appreciated significantly which it should. No one knows what the stock or housing market will look like in the future so you just have to wait and see but I think it'”
“Just a reminder here, it's all theoretical. Remembering all my neighbors who lost their jobs in the housing crisis and then lost their homes. They bought at around double the price of what we had bought several years earlier, and at incomes that couldn't support it. Homes went to the bank or were bought up around 40-50% less than they were purchased. Some sat for a couple of years before getting sold. Home purchases are certainly not risk free investments.”
“Honestly, if you don’t want kids, why rush into buying a home? Owning a house is very expensive, I feel like every other month I’m fixing something. A few days ago the handle on my drying broke off, so, I have to use pliers to open it until I buy a new one.”
“if you rely on 2 incomes, budget for living on the lowest one’s salary. You never know what is going to happen (one of you unable to work, laid off, etc). If you can’t make a mortgage payment without using savings you are setting yourself up for bankruptcy.”
“Be on the same page 100% before she moves in. If this a very serious relationship, meaning you think you will or intend to get married, everything is communal. How you split that can vary based on income etc. But start treating shared things as communal financial responsibilities. It will eliminate a lot of headaches later on”
“No, you're not delusional, you could probably do it in 2-3 years. I'd recommend setting aside that 1k either in a hysa if owning a house is a definite goal or split between retirement and down pay payment if it's a soft goal. Because you do have 10k set aside, you could start browsing. Get to know the market, see some houses you like (on zillow) and see what you don't like. Start to learn about real estate strategies, etc. If a deal pops up in budget sooner than expected, awesome”
“So my wife and I have been in our home for 9 years. We owe 160k on it and are looking to list for 290k. We should come out with about 130k and plan to put 90k down to meet the 20% requirement on a 450k house. This would leave us with about 20-30k left in the bank. Question is, we currently pay 1700 a month and our mortgage will jump to 3000k. We can realistically afford about 2100 but plan to regularly dip into the 20-30k as a cushion until our baby gets out of daycare, freeing up $1100 a month.”
“Rule of thumb is 33% for rent or 50% for rent+necessaries like your debt. 1200-1300 per week is about $5600 per month so you could afford Option B. You also have some savings (assuming liquid for a possible emergency). Choose Option A if you have harder saving goals.”
“Didn’t get serious until 37, my current age I make 90k plus some OT Wife makes ~38k 21k in 401k 3.5k in Roth I am now maxing my 401k, she is maxing her Roth $31k left on mortgage, house is worth $250k 1.1k /mo house, ~200/mo cheap car, 200/mo train commute expenses, never having kids Working on saving/earning more to start stacking my own Roth. Working hard towards promotions. Dr. ChatGPT, MD said if I live in a high tax state, which I do, and then run a very lean retirement, which I will, maxin”
“I’m hoping to close on a house in the next few weeks, have down payment in HYSA ready to go. I anticipate being left with: ~25k in savings once closing costs goes through (covers about 5mo of expenses/needs) ~25k in series I bonds over 5 yrs old ~ 37k in taxable brokerage invested mostly VOO/VT/VXUS I also have a healthy 401k and HSA both are maxed out annually. The house will need somewhere between 5-10k in repairs that we know of (some masonry work on the chimney) and we want to do a few renov”
“How much is the place that you are renting approximately? Are you happy there? If it's an expensive place, rented for cheap then might as well stay there and save till you figure out long term plans.”
“I just did some googling average near Rhode Island and Massachusetts is around 519k-672k. With that information my answer would be no with that income unless yall pool both incomes and buy under median house. That means you’re in the range of 3-4k. If you think you can comfortably afford that and also have savings for problems that happen when owning a house.”
“100% depends on where you live and what type of home you want to own. Where I live you can get a house that needs work for $175k and pay a bit more than your rent for a mortgage payment including taxes and insurance even with a minimal down payment. Most other places you are looking at paying double that for most any house. If you want a big, fancy move-in-ready house in any market you are likely out of luck. If you want a fixer-upper or really dated house in a LCOL area, you can buy a house no”
“You can also look into First Time Home Buyer grants. That's how my boyfriend at the time bought his first house. There's different types of grants depending on what works best for your income and qualifications. He bought his house before he was 30. He put the house in his name and I paid him monthly to cover part of the mortgage/utilities while I lived there.”
“Hi all, I’m 24 and work full time making 75k a year. I currently live with my boyfriend and we split rent/utilities by income percentage cause I make more than him and then groceries we split 50/50. Our landlords live below us and haven’t raised our rent in 3 years and told us they don’t plan on it (total rent is 1600 per month for a 2 bedroom w two parking spots) My basic breakdown of my finances per month are. Rent/utilities $1,100 Groceries $200 Car payment $330 (3 years left until it’s paid”
“My husband and I are trying to decide whether it makes sense to buy a new house or stay in our current home. We bought our current townhouse in 2020 for $335k and have a 3.6% mortgage rate . The house is currently worth roughly $480k . Our mortgage payment is around $2,300/month . Our household gross income is approximately $170k–$180k/year . Financially, we’re in a pretty good position. We have approximately $540k in liquid/invested assets , mostly invested in S&P 500 index funds, in additi”
“Late 20s female. I'm moving out on my own for the first time and being that I live in a HCOL city, I'm kind of worried if I made the right decision. Current income: $100K. I get bonuses but I don't factor those in as they go straight into savings. I pay for the following: Rent: $2,050 Car: $374 Insurance: $313 (this is between 2 cars, mine and my parents) Phone: $180 (family plan) Therapy: $200 Internet: $60 Electric bill: $100 Student loans: $67 It's a lot and I'm left with”
“We’re getting married this year and are trying to buy a house in the next 2-3 years. (My stock matures in 2 years) The houses that we like are around 650k-750k. We likely won’t go over 750k considering our total income is 216k right now. However, we only have 105k saved. 145k is in retirement (mix of trad IRA, trad 401k, Roth IRA, TSP) 105k (or 255k) LIQUID: - 50k in CD maturing sept 2027 - 15k in HYSA - 40k in brokerage in safe index funds or ETFs like VOO or VTI. - future hopefully: in 2 years”
“I am not in the position currently, but I have considered the idea of lowering my monthly payment. My current salary is $180k and my mortgage is $4300 per month. It is a little heavy in my budget and I have been quite fortunate in some of my investments that a recast could be in my future. This said, I know investments return at a much better rate than housing historically, but my house is at 7% interest and that is fairly close to the average annual returns on something stable long term. My que”
“I don’t know what the prices are in CA but I think you’ve severely underestimated your expenses once the kids are older and you all have more time on your hands. However I think you’ll be fine either way since you plan on continuing working.”
“yeah that's the part people miss, its not coming out of someones monthly income lol, totally different math than what op's assuming”
“Yeah but why doesn’t lenders take an average or look at the track record of us paying the Mortgage on time the past few years”
“I (30M) am getting a divorce and am considering staying in our current house while my ex moves out. I currently make 115k and rent is 2800 per month, closer to 3100 with utilities and internet. I would like to move to an apartment to save money but this house is in a convenient location that is 10 minutes from work. My bimonthly take home is about 3400 after about 5% 401k contribution so essentially half my take home would go towards rent.. I’ve never not split rent before and this makes me extr”
“Early on i agree with you, the real money in property is in the appreciation. The goal is often to break even on the month to month and allow the equity to build, later when your rents far exceed the mortgages you can use the extra cash flow to pay down one of the properties aggressively and eliminate the mortgages one by one in fairly quick fashion. If your goal is to retire with income coming from paid off properties and you feel you have enough. Optimally you probably should just keep using l”
“I’m 26, I have about 22k in debt. I’ve been saving up money the past few years to put towards a home. I just started making enough to put my loans on auto pay. Should I prioritize paying off the loans or buying a house? submitted by /u/Woe_Mitcher [link] [comments]”
“Cross posted in first time home buyers, but trying to get more opinions. We are ways off from buying but in early discussions of getting our finances together. I am 7 months pregnant, and I work in healthcare in MCOL city, 3 12 hour day shifts weekdays only. We had decided that after maternity leave I would cut down to part time (2 12 hour shifts) and rely on one day of family help and a weekend shift to avoid the cost of part time daycare (which is averaging over $1500 a month for one infant) I”
“I have to I get about 4K worth of home repairs done and the wife and I are split on how to pay it. I came up with 3 options 1) just pull the money out of savings idiot that’s what it’s for(even though I feel this isn’t emergency enough) 2) sell some gold and silver since doubled in value from the majority of my buy in. I’m kind of on board because if I have a house fire or get robbed I might lose it anyways but I like holding shiny things. 3) the option my wife is 100% against is opening up the”
“Hi all, I'm 30 year old and single living in a HCOL city in California. I make $140k base (not accounting RSUs and bonus). I'm trying to decide if buying a home in the next 5 years is a smart financial decision if I want to increase my overall wealth portfolio. Should I reduce my retirement contributions to max out my Roth IRA and 401k match for the next 4-5 years and increase my overall salary to buy a home or continue renting and aim to max out my retirement accounts and just simply wa”
“Hi all, I'm 30 year old and single living in a HCOL city in California. I make $140k base (not accounting RSUs and bonus). I'm trying to decide if buying a home in the next 5 years is a smart financial decision if I want to increase my overall wealth portfolio. Should I reduce my retirement contributions to max out my Roth IRA and 401k match for the next 4-5 years and increase my overall salary to buy a home or continue renting and aim to max out my retirement accounts and just simply wa”
“A quick summary of my problem is im wanting to buy the land im living on from my dad its a mobile home on 2 acres I already know getting a home loan is gonna hard to get what other options do I have as hes asking 60k for the land and the home would be included with the land submitted by /u/Pretend_Stand_696 [link] [comments]”
Use it all for a 25% down payment on a rental that cash flows.
“Title says it all basically, I have a house that’s worth $1.2m I owe $500k on it. I’be been debating selling and buying a house around $500k to be able to jump start my investment accounts. I previously had holdings in VOO and some other stuff. TLdr: have nice house or have avg house and $700k in stock, I’m 29 yo Thanks In advance Edit: QOL wouldn’t really change, I’d be moving from a brand new build on estate lot, to an upper class neighborhood. Same school district. My interest rate would be t”
“I've owned a couple different homes. I've rented apartments. I prefer renting because of high property taxes and maintenance. Even without a mortgage, it's still $900+ per month for property taxes on my 3 br/1 ba middle class home, I just paid over $25,000 for a new roof, etc. But the home has increased in value a lot over the years, too. I haven't sat down and figured if I've come out ahead financially with the cost of owning the home vs increased equity. I lived in my last”
“Leigh Brown recently spoke at a local-to-me event & told us about how she used stacked DPAs to help first-time home buyers afford to buy. $250k purchase, $50k in stacked DPA which also had the benefit of causing the necessity of mortgage insurance to drop off. Then of course if the buyers own the home for 10 years, the DPA is forgiven. I left the event super hopeful for my whiteboard full of pre-qualified first-time homebuyers who can't afford to buy in my area, but quickly came to find”
“if the goal is leaving for a lower-paying job in 7 years, wouldn’t having more cash and investments be more useful than burying $2k a month in the house?”
“I have no idea what I’m doing. I have 70k that I’ve been sitting on with the intent of using as a house deposit. I live in Tasmania. The cost of a house keeps climbing faster than wages and the cost of living here is quite bad. I have 2 kids of my own and a partner with two kids. Not married. Renting here is ridiculous. What should I do? Invest and wait it out? Invest in what? Buy a unit and rent it out? Buy property in another state? Any thoughts appreciated. submitted by /u/lostdou”
“My guess is we’d spend about 15-20k tops per month including mortgage and health insurance.”
“Dave Ramsey believes in paying down your mortgage like you're doing but he'd advise a slightly different mix of savings, 401k and Roth. Listen to a dozen episodes of the Dave Ramsey show and you'll hear him advise people like you with good incomes. He has a method that would definitely work for you if it resonates. Good luck!”
That is the negative side of it. For some people it's worth it.
“(Please ignore the grammar typo in the title, not sure how to change it now) Hello everyone, I’m going over what my monthly expenses would be while paying a mortgage. I’m running through this to see what I’ll actually be left with once all expenses are paid. This will be my first time ever going into debt so I really don’t I know if the final number I calculated could be feasible long term. Here’s the breakdown: $6350 net take home (monthly) -$2700 for housing expenses (principal, interest, insu”
“How the heck do you not have the money to fix problems with your house when you're putting $2000 extra towards the mortgage every month? Like in get it, a guaranteed 7.13% return from paying off your mortgage is hella worth it... But that didn't help you if the value of your house feels because it's held together with handyman, McGuyvered repairs and duct tape.”
“Hello Everyone, I decided that my 12 year relationship wasn't for me anymore last month and unsure how to go about this house we bought together. We bought during covid and got a sick 3% interest rate. I'm just wondering what my options are. I want out but I also don't want to screw her over. We live in Washington of that changes any advice. She wants to keep the house but I heard she'd have to buy my portion out via Cash which she doesn't have or refinance which would be ter”
“We sure could use the space. My wife and I are 46, we have a four year old son. We live in a condo and owe $78k. There’s only 8 years left on the mortgage, we refinanced in 2020 to under 3%. If we sold I think we could get $200k. The monthly payment is $860 for the condo and $350 for HOA. We make about $140k between the two of us per year. We have about $200k in retirement savings. On top of that, I’ll qualify for a state pension. The financial independent route I think would be to suck it up an”
“Option one: stay in current home for more years to build equity, but then homes in hometown might go up in value too. Been in current home three years. Have 30 year mortgage. 27 years left. So stay a few more years and hopefully have very large down payment for hometown home from net proceeds once selling this home down the road Option two: move now. selling house now would probably mean roughly breaking even and getting down payment back. New place would be a stretch financially but bank would”
“Hi, I’m in the process of buying a house and wanted to sanity check my house payment. Currently don’t have debts but live in a HCOL. Take home is $22.5K per month after all taxes, 401K and insurance from our salaries (both wife and I work). No kids but planning for some soon. Will have a house payment of $6,300 up from $4,800 rent currently. We save about 6K a month after tax and our year end bonus of ~70k. On paper seems like we should be fine but we both come from humble backgrounds and this b”
“Stop paying down your mortgage for a few months. Put that extra into savings and let it stack up till you have enough for home fixes. Then go back to paying down.”
“I did everything at once which was cheaper per window/door but cost like $40k for everything. Not a cheap job.”
“I did the same thing years ago. Saved 5 years. Paid for 5 years. Paid it off ( first house $100,000) in 1997. Debt free since”
“I (27) bought my home 1.5 years ago in a MCOL area for $300,000. Since then, I've put 2000 extra per month on my mortgage every month. I know I'm in a privileged position and I'm trying to make the most of it. I'm constantly dealing with home fixes I don't have money for, and DIYing everything I can to reduce costs. I'm wondering if there's something I'm handling wrong with how I allocate my income. I've tried to educate myself on finances but it seems like ev”
“you didn't mention spend at all, that's the whole ballgame 7M with a kid and a mortgage could be tight or could be cruising depending if you're burning 150k or 400k a year”
“Right now I’m renting in VHCOL and have been looking to buy using a VA Loan in the same area. In the long term I’m sure it will make sense but it will take away from my current zero-based budget/ investments. Right now my company does a 16% DC and I match that with another 16% (~$2000) pre tax. I also put 50% (~3500) in my brokerage account post tax. Below is my rough budget Money In (post tax) Paycheck ~$3,500mo Additional income $3,939mo Total Income $7,439mo Money Out Housing (Rent/ Utilities”
“There’s about $70k remaining on my dad’s mortgage. He wants me to get a loan to pay off the mortgage so he can sign the house over to me, and he can move into his other, much smaller, and much cheaper, house. I already have a somewhat fresh mortgage (bought a $600k house 2 years ago) but i could afford a $70k loan if the interest was reasonable. I don’t want to put myself in a hole if getting a personal loan is not the way to go. My dad is a simple man and in his eyes, this is the simplest and e”
“Hey yall, Currently I have a $212k mortgage that's about almost 3 years in, at 6.99% to 30 years, maybe about $205k payoff amount remaining. Approx. $1400/mo in payments. Now that I am making more income, I am considering to refinance. I got a referral from my agent for a loan agent to see if he can get me a good rate, and looks like he can get me 5.75% at 15 years, I think the fees is $5500 after everything, or 5.625% at about $6200. Should I go ahead and consider a refiance at my scenario?”