Percentage of take home salary on mortgage?

[gangzoom]

We moved to our hopefully final family home 2 years ago, which meant taking on a substantially larger mortgage debt than previous.

52% of our joint income have gone into the mortgage including overpayments over the last 2 years. Will keep up similar ratio over the next 3 years.

Its a fairly aggressive repayment plan but I hate any kind of debt, the aim is to be nearly mortgage free by the time we hit 45, which means 20 years+ of earnings without mortgage to look forwards to, which is a goal worth working towards.

Edited by gangzoom on Wednesday 24th April 06:39

[croyde]

Mortgage is currently 7% of our combined but as we split 10 years ago the shocker is that here in London my rent for a small one bed was over 75% of my own take home.

[pmanson]

30% for me as we've just borrowed some more for home improvements.

Essential spend (eg. mortgage/council tax/food etc) is about 53% of our income (taking into account the new higher mortgage payment), 29% on discretionary spend and 18% on savings (eg. for holidays)/investments/additional pension contributions etc

Roll on when my wife can go back to work!

[cashmax]

The answers are not relevant unless you know details of mortgage, LTV, overpayments, etc. Some folks will prefer to put 80% of take home into a mortgage to clear it quickly whilst others might be at 5%, but interest only on huge outstanding amount.....

[DonkeyApple]

Username... said:

We're thinking of increasing our mortgage to fund a larger house in a nicer area.

We are pretty comfortable with our current mortgage as it only represents about 13% of our combined take-home salary. We don't have any other major debts and we generally don't need to worry about finances too much.

For our next move we don't want to mortgage ourselves up to the eyeballs, but we want to stretch ourselves a little because we may stay in this home for a long while.

I'm wondering how much Pistonheaders spend on their mortgage vs. take-home salary? How comfortable do you feel with this balance? Has anyone stretched themselves too far and regretted it, or perhaps wish you'd stretched yourselves a little further?

I appreciate there's lot's of variables, differing circumstances, etc. but it would be interesting to know what people commit to.

You’re talking much lower percentages than much of the UK. The key is the risk side. Two similar incomes safer than two that are imbalanced. Lower incomes safer than higher due to the greater ease of finding a replacement income quicker. General job stability of the two incomes etc etc.

As someone above pointed out, a larger home has larger running costs, council tax, insurance, utilities, maintenance and a larger mortgage requires a larger cash buffer for the unexpected.

[BoRED S2upid]

17% of joint interestingly enough nursery fees are exactly the same.

[Testaburger]

Surely it depends on income and other outgoings.

If you have a take-home of 12k, you’ll likely be well-placed to spend 50% of your net pay on the mortgage, as opposed to 50% of 3k.

Of course, that’s notwithstanding risk to your incomes, or anything else.

[danpalmer1993]

First time house owners, when we started it was about 24% but down to 18% now. Expecting it to go back to 24% when we look to move in about 18 months.